Evolution of online banking

  • ERemit
  • 2 minutes read

Online banking or Net banking! Well, both these words aren’t a surprise anymore, they have become a significant part of our lives in varying degrees of paying bills, day-to-day shopping’s, international money transfer etc. It is simply an electronic payment system that allows the customers of a financial institution to conduct transactions through the institution’s internet-available website or mobile application.

It is simple and convenient! People can no longer think of an era without mobile banking. But where did it start? How mobile banking came into existence? Let us dig deep into the evolution of your so-called favourite “online banking”.

Bill Gates once made a famous proclamation in 2009, “Banking is essential, banks are not”. By this statement, he meant that the traditional banking system, the brick and mortar banking, will gradually disappear and, electronic banking will replace it by attracting more and more users. He was right. We are the sole witnesses of this gradual progress.

It is believed that the modern shift towards electronic banking came with the existence of Automated Teller Machines (ATMs) in London, the United Kingdom, back in 1967. With this iconic start, electronic banking started and now ended up with the most revolutionary online banking. In fact, the early seeds of online banking were sowed in the 1980s by the Bank of Scotland in the United Kingdom. This banking facility, designed exclusively for the Nottingham Building Society (NMS), was known as Homelink. It was meant for them to pay the bills and transfer money through telephone and T.V sets. Unfortunately, these services discontinued as the customers were prudent and not fully ready to accept the then-latest trends of internet banking.

It was in the 1990s, the rapid growth of the IT sector inspired the banks to launch internet banking again. This time, the success was tremendous electronic financial services attained industry standards. People realized the ease and convenience offered by mobile banking. Banks and other financial institutions made special efforts in maintaining a hassle-free and secure banking experience for the customers. In this current world, online money transfers have become the easiest way for every money deal!