Conclusion of various sources of credit project of class 10. Plss fast
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In this report, we discussed how the new payment methods impact on banks in three cate gories. Here, we summarize them and triy to make suggestions to banks for survival. Transactions between the individuals would be made more convenient by the emergence of Mondex-type smart cards. On the other hand, banks will lose fees for person-to person money transfer and fees for ATM transactions. Though adoption rate of the smart cards can not be pre dicted, banks have to look at other business functions by aggressively join smart cards projects. As the smart cards proliferate, they would make money by issuing the smart cards and transfer money from banking account to the cards Emerging methods for transactions between consumer and company can be divided into three methods- (1) expansion of credit card method, (2) Digital Check and Internet Banking and (3) Smart Card and Digital Money. The impact to the banks are different in each cases. For case (1), opportunities to make loan for consumers will increase due to the increase of credit card use. Banks should leverage the information on customers to gain profit. For case (2), though Digital Check will make business chances for banks by motivating consumers to open account, handling charge from normal type of money transfer will decrease. Internet banking will bring about new opportunities for banks to gain handling charge from customers by expanding customers base and will reduce the operational cost of banks drastically. However, since the entry barrier to Internet banking is low, banks which fails to make strategy about Internet banking will decline. For case (3), banks can enjoy new opportunies to gain handling charge to deal with Digital Money. On the other hand, banks may loose all information, handling charge and credit business by Smart Card and Digital Money. Banks have to promote the favorable methods and join to construct the new rules to profit all the participants when they promote these methods. By netting through EDI, transactions between companies will be compressed and the com panies might take over some portion of the settlement function that banks have traditionally con ducted. Banks would lose money, and lose control on companies by losing information on the business movements accompanied with the transactions. In order to overcome the threat, banks should expand their business area by acquiring the knowledge of the technology and business related to the EDI and providing total integrated finance systems to companies. We found new payment methods are not only a threat but also a potential benefit to banks, which is somewhat contradictory to what we might have expected. Banks should realize the profit and cost to promote new payment systems and to not deal with new payment methods at all. They also should realize how they can leverage the expertise on settlement and technology in order to survive
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