Over the past few years, advancement in information technology has changed the way organizations operate and conduct their business (Al-Jabri, 2012). Technology is now being used by businesses today to enhance growth and competitiveness (Anyasi et al., 2009). Firms are developing new and innovative products to be able to maintain existing customers and to attract new markets. One such innovation is the introduction of m-banking technology in the banking sector. M-banking has changed the way banks perform their operations, this has led to the introduction of new products and services that are aimed at lowering transaction costs and reaching a larger number of customers (Ayo et al., 2010). M-banking provides the potential of increasing efficiency of payments system and expanding access to formal financial services by those who presently lack it. Microfinance institutions (MFIs) have existed in many forms for decades, but have only recently garnered global attention as a commercially viable activity that can offer real opportunities for micro-entrepreneurs and the unbanked people. According to Gomez et al. (2008), MFIs have expanded throughout the developing and developed world and now serve over 10 million households worldwide. Despite the relative poverty of their clients, MFIs have been able to extend credit to poor households, while still maintaining financial sustainability. Much of this success has been attributed to MFIs innovative use of peer group lending; the practice of allocating loans to individuals with little or no collateral but with social capital in the form of peers who are also co-applicants and who in many cases are jointly liable (Gomez et al., 2008).
The remarkable gains made towards mobile phone access have seen a steady progress in the scope of innovations emanating from exploitation of these fairly new technologies. New innovations are challenging the idea that development requires handling ideas down from developed to developing countries. In banking and finance, the big ideas in cashless transfers and mobile flexible exchanges are not to be found in Geneva, London or New York. A revolution in mobile money transfer has occurred, but not in these financial centers. Instead, it happened in Kenya with M-pesa. The service was developed between Safaricom and Vodafone, and launched in 2007. This is not just something used in cities or big commercial interests. By 2010, over 50% of Kenyan’s population had used it. This means rural villagers haggling over produce, and then using their phones to make the final deal (Olivia O’sullivan, 2012).
The policy debate has been shifting from the finance-growth nexus to the finance-inequality relationship. In the transition from Millennium Development Goals (MDGs) to Sustainable Development Goals (SDGs), there has been an urgent policy challenge of putting some structure on recent advances in finance for more inclusiveness. The overarching question tackled in this paper is: to what degree has financial development contributed to providing opportunities of human development for those in the low-income strata and by what mechanisms? We survey about 170 recently published papers to provide recent advances in finance for inclusive development. The analytical approach consists of first, situating issues of exclusive growth in the context of the literature and then reviewing recent financial inclusion growth strategies. Developed and developing countries are separately engaged in some currents to account for heterogeneity in financial development benefits. Retained financial innovations are structured along three themes, notably: the rural/urban divide, women empowerment and human capital in terms of skills & training. The financial instruments are articulated with case studies, innovations and investment strategies with particular emphasis, inter alia on: informal finance, microfinance, mobilebanking, crowdfunding , Islamic finance, remittances, Payment for Environmental Services (PES) and the Diaspora Investment in Agriculture (DIA) initiative.
banking and trading activity, the fixed income group or salaried classes are also start using these facilities. But still there may be the criticism that, it induces more purchases or make the people for spendthrift economy. This may be so in the primary stage, but when once a customer gets used to avail these modern banking facilities they will know how to use the same in a discretionary manner. On the whole, the paper concludes that, based on the areas of usage, the satisfaction level of the respondents are good even nevertheless they are partaking glitches with respect to digital banking i.e. functioning of ATM, distribution of network, acceptability of new age payment systems, safety of online transactions etc.
Mobile Commerce is the subset of e-commerce, which includes all e-commerce transactions, carried out using a mobile (hand held) device. This paper attempts at figuring out the relevance and potential role that M commerce in India is at its infancy. With significant uncertainties and complexities due to evolving business and regulatory models, which are further complicated by the involvement of large member of interrelated players in it. Timely and correct public policy intervention are needed to allow it to unravel its potential and help the country to reap the benefits. The basic purpose of topic is to throw light upon increasing use of mobiles & smart phones in business, trade & commerce industry. The topic has been divided in to four phases. In the first phase, general introduction about mobile commerce has been discussed. The third phase of the topic describes the key statistics on use of mobile & Smart phones by Indian in various market segments. In the final phase, efforts have been made to explain the impact of M-commerce on Indian Youth & issues and challenges which still to be concentrated and addressed in the area.
Green banking is not separate from general banking and noted as a socio-protective financial services. It just talks about the investment in the project that is not harmful to the environment or at least not to create negative externalities to the economy. The way the green banking works is to taking the in-house management system and to convince the deficit economic unit by providing fund that goes to the place which protects us from bad responses of ecology mentioned as green finance. Because of non-balancing of social factors either the environment or the economy suffers, or sometimes the both. Bangladesh is the most vulnerable country that suffers from the adverse impacts climate changes (UNDP, 2004). In Bangladesh, the central bank takes initiatives for the implementation of green technology. The major instances of Bangladesh Bank regarding automation as part of green movement are Bangladesh Electronic Fund Transfer Network (BEFTN), Bangladesh Automated Cheque Processing System (BACPS), National Payment Switch (NPS), Enterprise Data Warehouse (EDW), Electronic Government Procurement (e-GP), e-tendering and e-recruitment in the banking network. For smooth and quick payment settlement by banks, BB has already launched another software named Real Time Gross Settlement (RTGS) system initially with 5000 branch of 55 banks on October 29, 2015 (The Daily Star, 2015). Green finance shows the route how a person can get to be the first served in the bank for taking fund that is socially viable. However, a case study on the green freight initiatives of China done by the World Bank shows, most of the truck of china are not well utilized on energy efficiency technologies and practices. Because there are some reluctance and information dissemination of concerning authority which take the truck owner consume 54% of fuel of transport sector fuel consumption (World Bank, 2011). But, we are lucky enough due to having a lot of natural gas that works heavily for reducing smoke. Financing onto the green vehicle is also an initiative as green banking.
From transaction personalization to customized, one-to-one marketing capabilities, the future of ATMs is in their value as customer relationship and marketing vehicles, allowing financial institutions to mitigate the trend of declining ATM profitability while maximizing the potential of their ATM programs The findings concur with (Porterand Millar, 1985) that IT has led to changes in industry structure and competition and many firms have used IT to support the creation of new businesses. The study also noted that ATMs are a cost-efficient way of yielding higher productivity as they achieve higher productivity per period of time than human teller, ATMs have eliminated the need to enter a bank for basic transactions and allow access to accounts at machines, The use of ATMs has cut service staff in traditional banks, as the ATMs continue when human tellers stop, there is continual productivity for the banks even after banking hours.
Abstract—Islamic Banking (IBg) in Malaysia continues to grow rapidly and Malaysia is considered to be one of the most advance developed countries among the other Muslim countries that employs this banking system. Concurrently, Islamic Housing Finance (IHF) in Malaysia has been running almost 30 years, began when Bank Islam Malaysia Berhad (BIMB) was established in 1983. Then it allowed other Islamic banks (IB) such as Bank Muamalat Malaysia Berhad (BMMB), Maybank Islamic, CIMB Islamic, AmIslamic Bank and so forth to employ the same concept. However, the practices of IHF still have some issues on compliance with Islamic principles such as riba (usury), maysir (gambling), and gharar (uncertainty). Actually, the other issue is on calendar as a basis of accounting system. Quran Surah At-Taubah: 36-37 depicts that there is a clear guidance for Muslims to use the Islamic Calendar (IC) for his or her mundane and spiritual lives. Contextually, calendar is a system to organising days for religious, social, commercial or administrative purposes. During this time, all IB in Malaysia are using Gregorian Calendar (GC) as the basis of accounting system. GC is a solar year, has 365 days and leap years to the days of 366. Meanwhile, IC is a lunar year and has 354 or 355 days. Interestingly, IC is shorter than GC and this would affect the loan particularly mortgage repayment of Islamic Housing Finance (IHF). Therefore, this paper will discuss and compare IHF in IC and GC particularly to those who taking loan by mortgaging the property.
awareness of the significance and practice of Islamic banking, Iqbal (2006) recommended that introductory content about Islamic economics and Islamic banking should be included in the high- school Islamic studies course. He also believed that professionals from diverse backgrounds should engage in researching and promoting the concept of Islamic finance. Given the Sharīʿah scholar crisis in the Islamic banking sector, there was found to be a great need to build an infrastructure to overcome the shortage of Sharīʿah scholars. There has been a notable effort in Malaysia to provide opportunities for graduates. Malaysia utilised the skills and knowledge of unemployed Islamic studies graduates (DewanAmal Islam Hadhari) who received training from a recognised training institute (Islamic Banking and Finance Institute Malaysia – IBFIM). These trained graduates were then given experience at selected Islamic banking institutions, including the country’s largest full-fledged Islamic bank. Developing employment opportunities for Islamic studies or banking graduates through proper channels could be an example for other countries to follow to bridge the human resources gap in the Islamic banking sector.
The findings of the study suggest that the both CBs and IBs enclose differences as well as similarities pertaining to the elements of CG, that are board responsibilities, legal and regulatory compliance, internal control environment and auditing along with Risk Management as follows. In CBs, BOD is responsible for an effective CG framework that ensures legal and regulatory compliance. While in IBs, two independent boards, BOD as well as SSB is responsible for the governance. Hence BOD ensures legal and regulatory compliance while SSB ensures Shariah compliance of the bank in IBs. It is identified that when CBs document CG disclosures relating to BOD, IBs have to present disclosures relating to BOD as well as SSB. It is further discovered that SSB of IBs have more power than BOD. On the other hand BOD has the ultimate responsibility and the power in CBs. Moreover IBs and CBs are observed to conduct internal and external audit. In addition IBs conduct a Shariah audit. IBs and CBs both follow all national and international regulations applicable to banking industry in SL. Additionally IBs follow national and international regulations that applicable to Islamic FIs too as they follow Islamic financial principles. Furthermore IBs have a similar taxation treatment as CBs, as they also subject to current tax, deferred tax, Value Added Tax on Financial Services and Economic Service Charge. However, additionally IBs are charged with Zakat tax as IBs required to ensure social justice among various group in a society.
As a main component of the Islamic financial system, the Islamic financial institutions are obliged to work in an environment of risk existence. In a broad sense the risk implies the exposure to uncertainty. Risk management is a process of identifying, measuring, monitoring, reporting and hence controlling the risk (Dorfman, 2007). Changing financial market trends have posed various risks to financial institutions including the Islamic banking system. In the banking operations risks are not unavoidable, same as that of conventional banks Islamic banks also have to face the risks but of different nature due to its shariah compliance assets and liability structure. Islamic banks products are based on profit and loss sharing and conventional banks don’t do so (Bhatti, 2010) The Islamic finance system does not reject risk but it denies the two extremes of risk behaviors; risk avoidance and excessive risk. Since Islamic finance is based on real production oriented ideology, it encourages the risk taking approach in economic activity but it is against the extreme side of uncertainty and hence the returns and risks are balanced. Islamic finance is purely based on the cooperative approach and prohibits Riba (interest or Usury) of any kind as it jeopardizes the livelihood of the people in a society. The other main principal of Islamic finance is based on ethical standards as depends upon religious concern of parties, the investor and the debtor to ensure serious consideration of the nature of business and its products. Islamic finance integrity lies in liability and the inevitable risk that both parties have to share (Chintaman, 2014). Through cooperative arrangements many of financial and economic objectives can easily be achieved rather than for profit gaining arrangements. Muslim investors and Islamic financial institutions jointly can share the risks they are facing by making non for profit arrangements which are flexible and can accommodate any type of risk (Al- Suwailem, 2006)
participants of the 2012 and the 2014 New Zealand Finance Colloquiums, the 2014 Australasian Finance and Banking Conference, the 2014 Auckland Finance Meeting, the 2014 Massey Business School Doctoral Consortium, the research seminar at the University of Auckland, the School of Economics and Finance brown bag seminar at Massey University and several other presentations for your useful comments.
By now, a good deal of intellectual effort has been undertaken by a number of specialists in Islamic economics to explore different aspects of Islamic banking and finance. Even some conventional economists, intentionally or unintentionally, have dealt with the subjects, which may be considered closely akin to it. It is an undeniable fact that Islamic financial institutions have had only a marginal existence during the last 300 years. They did not get the same chance as western financial institutions to gradually evolve their institutional structure, tools and modus operandi to their full potential. Therefore, such evolutionary process of Islamic banking and finance must be done through serious intellectual work by economists rather than observing institutions at work. However, Islamic banking and finance has now been in the arena for more than a quarter of a century. It has taken a
The pre and post liberalization era has witnessed various environmental changes, which directly affects the previously mentioned phenomena. It is evident that post liberalization era has spread new colours of growth in India, but simultaneously it has also posed some challenges. This article discusses the various challenges and opportunities like High transaction costs, IT revolution, timely technological up-gradation, intense competition, privacy & safety, global banking, financial inclusion. Banks are striving to combat the competition. The competition from global banks and technological innovation has compelled the banks to rethink their policies and strategies. Different products provided by foreign banks to Indian customers have forced the Indian banks to diversity and upgrade themselves so as to compete and survive in the market.
Abstract— Technology plays an important role in banking sector. Banking is one of the largest financial institutions constantly explores the opportunity of technology enabled services to provide better customer experience and convenience. Mobile phone is a common technology device that became part of every individual in the information era. MobileBanking is an emerging alternate channel for providing banking services. India is the second largest telecom market in the world, which is having high potential for expanding banking services using mobile. However, mobilebanking has not become the choice of millions of people. The main objective of this study is to identify the mindset and analyse the security issues in Mobilebanking among the banking customers in India.
Acholiya, &Keshari (2013) mentioned in their research that in today's hi-tech world, technology support is very important for the smooth functioning of the banking. Without information technology and communication it is difficult to think about the success of a banking sector. ITC has enlarged the role of banking sector in the economy. The reason why the use of technology is so important in banking sector is the benefits that are consequent to it. ITC enables banks to offer better services to its customers in a secure, reliable, affordable manner and sustain competitive advantage over other banks. Banks are also able to give quick response to the customer queries. In the competitive financial market, the banks with the latest technology and techniques are more successful in the modern civilization and are also able to generate access profits. For customers, remote banking, anytime banking, self-inquiry facilities, etc have become possible. For employees, IT has increased their productivity through accurate computing of cumbersome and time-consuming jobs such as balancing and interest calculations on due dates, automatic printing of covering schedules, deposit receipts, pass book / pass sheet (transaction documents), freeing the staff from performing these time consuming jobs, and enabling them to give more attention to the needs of the customer, signature retrieval facility, assisting in verification of transactions, sitting at their own terminal and avoidance of duplication of entries due to existence of single-point data entry.
The term mobilebanking (M-Banking) is used to denote the access to banking services and facilities offered by financial institutions such as account-based savings, payment transactions and other products by use of an electronic mobile device. Mobilebanking has yielded a multiple effect on the number of solutions available to clients. M-banking provides the potential of increasing efficiency of payments system and expanding access to formal financial services by those who presently lack it. Tiwari and Buse (2007) refers to mobilebanking as the service offered by the banks in providing and making available banking and other financial services to their customers through mobile phones and other similar devices. MobileBanking channel is more than a decade old now. In the initial days, Mobile usage by banking and financial world was limited to the SMS or basic banking services. However the with the advent of technology, Mobilebanking channel is offering many dynamic functionalities.
Because of the known assurance about the benefits in the short run traditional banks can boost their benefits. Premium based banks can focus benefits over the long haul through supporting. Then again, there is no such degree to know the expense of trusts in advance. The depositors are paid a part of bank's benefits the volume of which is amazingly unverifiable. The Islamic banks could confront hardship in benefit base if benefit rate expected by the depositors is not understood. Islamic banks are relied upon to figure their rate of profit for PLS deposits occasionally. The common practice is that the deposits are weighted to reflect contrasts in their development. Banks set up a six month to month synopsis record of its operations and send it to the national bank, which decides the individual PLS rate to be paid by each one bank. Despite that individual banks are permitted to insignificantly go amiss from the proposed rate of return. In all actuality Islamic banks don't have control over the expense of trusts and there for it is an enormous boundary for Islamic banking.
An ordinary conventional housing loan is given on the basis of debtor/creditor relationship. Whereby, the amount of loan is being charged interest, normally quoted at a certain percentage above the Base Lending Rate (BLR) over the loan period, repayable in periodic installment. The BLR will fluctuate up or down and it will affect the total loan cost. Simultaneously, arrears in conventional loans are normally capitalized. However, under the Islamic banking scheme, since the BBA concept is being applied, a seller-buyer relationship will be established and the selling price is fixed upfront. The sales price is then repaid in periodic installments and the agreed installments will remain fixed throughout the financing period. As such, a customer’s inte rest rate risk is eliminated. Furthermore, arrears will not be capitalized.