The effect or impact of digitalization could be seen on every sector in the Nation. If you are not clear about the term Digitalization then let me explain it to you in brief, Digitalization basically means using technology especially digital, and making changes in the business model. Technology has changed everything for the past few years and then came digital technology which evolved almost every sector worldwide and in India as well.
Both government and private sector evolved in multiple ways, an example of this would be government made almost every other G2C service available online to the public. Not just the central government but the state governments also made moves under the digital India campaign and did the same. Some examples are the National Portal of India ( a portal by the central government ). Some state-run portals are:
- Digital Gujarat portal
- Rajasthan Social security Pension Portal
- Uttar Pradesh Scholarship Portal
- Direct Benefit Transfer Portal of Bihar Agriculture Department
- Human Resource Management System portal of Punjab government
There are online portals for almost every other department of government. In this particular article, we are going to cover the impact of digitalization on the banking and finance sector specifically.
How Indian Banking or Finance sector was impacted by digitalization
There is no doubt in that fact that the banking and finance sector is one of the major positively impacted sectors. Digital banking made banking processes and activities smooth, convenient, and easily accessible to every single customer or end-user which is the people of the Nation. Digitalization made banking processes more and more efficient as it is still growing and evolving. Not just the organizations or companies which were or which are benefitted from the digitalization rather the sole motive of making such big changes was to make things more and more convenient for end customers whether it be online money transfers within a few click or easy online shopping options and whatnot.
The establishment of ATMs was also a part of digitalization and further net banking, UPI and other online transacting formats came up and evolved the sector. Efficiency, transparency or trackability are some additional benefits that happened because of the digitalization of the banking sector.
Is it Still Evolving?
Banks are now competing and trying to provide the best possible digital services and experience to their customers so that they can acquire more customer base. Because of this competition ultimately users are getting a fast & quality banking experience, The government is also promoting digital transactions with the aim of making the economy digital or cashless. UPI is one of the major successes in the process of promoting digital transactions in the Nation.
If we talk about some number then according to a report from the National Payments Corporations of India total of INR 3,29,027 Cr was transferred through UPI
How AI ( Artificial Intelligence ) is becoming the new evolver?
Whether it be providing a better experience to the users or managing data at the backend, AI has been a backbone of the digitalization of the banking sector. Now AI is evolving things in the customer relation sector., all big private banks like HDFC, axis, etc are using AI chatbots to provide immediate customer support with a minimum possible effort of both the customer and bank itself with the help of AI.
We have covered almost every benefit and advantage in brief, now let's talk about the other side of the digitalization of the banking sector.
The Not so Good side of digitalization of the banking sector.
There's a negative or another side of this evolution as well which is the rise of cybercrime. In simple terms, cybercrime is basically the execution of illegal activities by the use of digital mediums or instruments. Digital criminals are also evolving day by day which is the dark side of the digital evolution. Banking frauds, identity frauds, etc are some common digital crimes or cybercrimes witnessed in the Nation and worldwide.
Although the government is taking steps to secure people against cybercrime and even banks are running awareness programs and eventually people are getting smarter but so the cybercriminals are. We always recommend every new user who is not tech-savvy to at least have basic precautious knowledge before jumping into the internet or digital banking activities because prevention is the best solution.
Today’s world is becoming increasingly digitally driven with technologies gradually reshaping multiple industries, including the financial domain.
From humble beginnings of online banking in the late 1990s to the possibility of, say, taking out a loan using a smartphone, those of us in the industry are lucky to witness the conversion toward a new era in finance.
Digital transformation is becoming an integral feature of the financial sector, but what is this transformation exactly?
In brief, digital transformation introduces technology to the business processes, products and services of a bank.
This Article Source is From : https://www.forbes.com/sites/forbesfinancecouncil/2020/09/29/what-drives-digital-transformation-in-banking/#bec4a3a7dc52
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