Moving into internet and mobile banking:

Banks need to assess risk factor

Harshini PERERA

While banks are moving into latest technologies with internet and mobile banking, they should also be concerned about the risk factor it carries, Central Bank Governor Ajith Nivard Cabraal said.

“In a time where people are concerned of the greater potential with less inputs in any industry, savings banks too have introduced fast moving technology into banking transactions”, Cabraal said at the World Savings Banks Institute (WSBI)’s Cross Regional Conference 2010 held at Colombo Hilton yesterday. There are more than 4000 branches and outlets of savings banks in Sri Lanka.

At present these banks have adopted new technologies such as retail banking, internet banking and mobile banking.

But, the personal touch the customers enjoy in coming to the branch will also have to be addressed by the branchless banking system, he said.

The Governor emphasized the need to consider the risk involvement mobile and internet banking applies.

Banks should play a key role in risk management, ensuring the integrity of the services provided by branchless banking, he said. The two day conference on ‘Innovative Distribution Policies for Savings and Retail Banks-Branchless Banking: How far we can go?’ with the joint sponsorship of WSBI and National Savings Bank (NSB) will highlight the importance of the most innovative distribution channels for retail and savings banking and how well-diversified distribution channels could be turned into a real competitive advantage.

“The savings banks will invest on various projects which helps the growth of the country that results in development.

Therefore savings banks need the support of the Government and legal authorities to protect the transactions done by savings banks,” World Savings Banks Institute, Deputy Director, Laurie Dufays told the conference.

She said that NSB is the first member savings bank of WSBI in which 7000 institutions have registered. There are 191,000 WSBI branches where the total assets are up to Euro 10,318 billion.

The purpose of WSBI is to raise the profile and to promote savings and socially committed retail banks with international institutions and stakeholders.