Future Developments

The local bank is in demise, as shown in recent times through the recent staff cuts in Barclays, the bank with possibly the highest high-street presence. Barclays laid off 6000 staff, roughly a third of its total staff, they attributed this to developments in technology and changes in the way that customers which to use there bank as the main cause for staff layoffs . In a recent ICL study 68% of the 4000 people questioned wanted the flexibility of being able to do there banking in there own time not being constrained by opening times. Banks are starting to cater for their customer's needs by investing heavily in telephone and Internet banking. HSBC one of the largest International banks has been developing the First Direct banking system whereby customers may telephone a call center at anytime in the day or night and check there balance or undertake any other tasks they would normally do at a bank. Barclays was one of the pioneers of the Internet based bank. The development of real non-customer facing banking solutions by major high-street name such as HSBC and Barclays is beginning to change the way we bank and add credibility to other ways of banking. One of the early ventures into forms of e-cash came in the shape of Mondex, introduced in 1995. Piloted first in Swindon this form of electronic commerce has been overtaken through the development of the Internet. The availability of the Internet exploded in 1990, this has seen not only the introduction of web interfaces from major banking institutions but also new Internet only banks. These new Internet sites enable customers to check balances, deposit money and pay bills. These sites are proving extremely popular as customers take advantage of the obvious benefits of banking in your own time. The following is a brief account of some of the electronic payment mechanisms currently available.

Digital Currency

Digital currency can be used in the same way as coins and notes are presently used. 'Money' is bought and stored in a virtual wallet, the cash being purchased and stored in complete animosity, in the same way that coins and notes are held and distributed. One of the key similarities of most digital currencies and money as we know it is that there is no reliance in outside agencies such as banks for fund clearance. As banks and clearing agencies are not needed transactions can take place instantaneously making Internet purchases an ideal use for digital currency. In recent years the use of digital currencies or tokens in web sites such as Amazon.com has become common place.

Electronic Credit Card Payment

The most popular and simple way of electronic payment is using credit card details. Credit Cards have been in circulation for many years and present many people with a simple, familiar method of payment. The problems associated with credit card payment do not come from the buyer but from the insecurities associated with the Internet. Although security issues are of paramount importance it must be remembered that in most cases Internet Credit Card payments are no less secure than paying for a goods over a telephone. Internet Security and the many issues concerning the safety of payment mechanisms is a topic which will be covered later in this document.

Electronic Cheque Payments

Electronic Cheque payments are simply a way of stamping a virtual 'IOU' with a digital signature which confirms that the buyer is genuine. These stamps can be added to any document or invoice. The buyer has a user specific encrypted virtual signature, which is validated by the vendor. Although this method of payment may initially be seen as simple, complex validation procedures need to be in place. The involvement of an external clearinghouse is also essential to authorise final payment. The payment mechanisms detailed above need a platform upon which transactions can take place. The two most common being EFT and EDI.

The Web ATM

This is a recent development, which seeks to centralise the functionality of many banks. Users are capable of selecting a bank of choice, entering a secure login code and carrying out basic banking tasks. The significance of this site is not that it enables users to carry out banking tasks but that it centralises the facilities of all sites in effect making the identity of a certain banks UN-important. The site can be view at www.ATM.com.

Financial Information Systems-John Lindsay-1999