Computers in Banking

INTRODUCTION TO COMPUTERS

IN BANKING

     INTRODUCTION:

Computer is a general purpose machine that converts raw facts into required information according to a set of instructions that are fed into it. It is a machine which executes an algorithm or a finite sequence of instructions to process data in order to produce the required results. The first large scale electronic computer ENIAC was developed in the year 1946 with a joint venture of Ballistic research laboratory of US army and Moore School of electrical engineering. The original objective of inventing the computers was to create fast calculating machines. But today 80% of computers are used for non-numerical purposes; hence we can perceive today computers as device acting on raw facts or data, which are either numerical or non-numerical in nature in order to produce results.

CHARACTERISTICS OF COMPUTERS:

    SPEED: It can work at a very high speed without losing there accuracy, most of the instructions are carried out in less than a millionth of a second.

  STORAGE: It can store data permanently on secondary storage devices such as discs, floppies etc. Data processing, a part of this data is loaded into an area known as primary storage.

  ACCURACY: The accuracy of computers which processes the data is very high and consistent also depends on the method of programming or type of machine which you are using. Errors may occur in the result but due to the increased efficiency of error deducting techniques they can be minimized.

  VERSATALITY: It can perform a variety of tasks provided the task to a series of logical steps.

  AUTOMATION: Once the programming instructions are ready in computers internal memory, the individual instructions are automatically executed without manual intervention.

  DELIGENCE: Unlike human beings, computers do not suffer from tiredness or lack of concentration etc. This factor is more important for those areas which involve highly repetitive jobs with same standard of output.

LIMITATIONS:

  NEED FOR AN APPLICATION PROGRAM: As a machine, computer can do what it is programmed to do and nothing neither more nor nothing less. It can provide only on data but nothing else.

  PROGRAM RELIABILITY: Sometimes a program appears to be flawless and error free, but it works properly for some period and then suddenly produces junks because of some combination of events has presented the computer with a situation for which there is no programming course of action.

  PROGRAM SUITABILITY: Merely, because a computer can be programmed to do a job, doesn’t mean that can be used for any application. Using of a computer with its huge developments in software field, programming is not a tedious but still it is time consuming and expensive.

  REASONING: Though technology is advanced in huge manner, still computers lack many mental capabilities such as thinking, evaluation etc which are still processed by a human being.

USES OF COMPUTERS IN ORGANISATION:

The use of computer organization is broadly classified into three categories i.e. Vertical application, personal productivity and work group computing. Many items organizations use these three areas of communication.

a.       Vertical applications are programs that perform every phase of critical business function. It is also called as mission critical. A typical example of this is the banks accounting system, which records all transactions that have occurred during the day and makes the necessary adjustments to the balances in the accounts. This system is vertical because it involves all aspects of business such as deposits, withdrawals, transfers etc.

b.       Personal productivity applications concentrate on tasks performed by individuals. Ex: Word processors that let you enter, edit and print text in various styles. Mostly such applications are run on personal computers. The wide use of such applications has reduced expensive clerical help in business & enterprises.

c.       Work group computing. It is a combination of vertical applications and personal productivity application; it is organized in order to produce some kind of corporate goal. It is made possible by networking of computers in which computers are linked together and then processes the information on co-operative basis.

COMPUTERS IN PRESENTING THE INFORMATION:

            In the present day business accurate, up-to-date and timely information is playing a huge role due to shorter product life cycles, narrow scope of opportunities etc. Apart from this to be a successful  organization by facing critical  developed new morals before the competitors does which is possible only through information and not only that getting timely information is one of the goal. Getting information is one step and more over that keeping it confidential is more important.

            Computer technology helps the organizations in preserving and presenting in excellent ways. Ex:Charts, graphs etc. It makes not only the entrepreneur but also the customer about the company products and prices.

COMPUTERS A MULTI-PURPOSE TOOL

            Until mid 60’s computers are used for a special purpose such as calculating the complex numerical tasks, but soon it’s started to contribute in more tangible ways. Computers role is not limited only to business organizations, but it has expanded even to other areas like music. Some of the related areas in which in which the computer is becoming a marvelous tool is mentioned as under.

  MEDICINE & HEALTH CARE. In medicine, doctors using computers right from diagnosing to monitoring patients status during complex surgery. Using automated techniques, doctors can look inside a person’s body and study each organ in detail, which was not possible few years ago.

  EDUCATION. Computers have revolutionized the education process in last few years. Infact it made education much more interesting.

  ENTERTAINMENT. With the use of certain techniques like multimedia and morphing the entertainment has been completely changed. It is not wrong to state without multimedia today’s entertainment would be incomplete.

·         Multimedia. It is an area in which text, pictures, animations, sound etc., are put together.

·         Morphing. In this technique two images are mixed to get the third one.

  SCIENCE. Computers are helpful to scientists in developing theory, to analyze and test the data, by which they can generate detail studies, which are helpful for common purposes.

  ENGINEERING/ARCHITECTURE/MANUFACTURING. Computers are helpful for all the above mentioned categories such as CAM (Computer aided manufacturing) can be used in designing the product, ordering the parts and planning production etc.

                  In architecture computers designers use their techniques for interior design of a house or office such as placing of furniture etc., Computers helps in designing and drawing various things according to the requirements of engineers.

Q.1. Explain some applications of computers in commercial world?

·         Payroll and personal records. Payroll accounting was the first commercial area to become widely computerized. The calculations of wages and salaries involves a no. of variables but they have same no. of common factors, Which relates to the personal details of each employee such as gross pay as rate for the job, tax code, insurance etc. These facts are retained on backing store (secondary devices) along with information each time the payroll is runned, such as pay date, tax deduction for the year. Any how primary data such as hours work, overtime etc., relating to the pay packages added to the input data for the particular run.  

·         Office Automation. Initially it was perceived that changes in office operations involving computers would be limited to clerical and routine functions of repetitive nature. In the event the science and technology of computing advanced rapidly more than what the business world thought and it has grown up to such a level that it could perform all business factions in a future and more reliable way. The rapid growth of micro computer gave extreme importance to office automation from early 80’s and contributed further to the gradual evaluation of electronic office.

·         Word processing. At general office level word processing plays a importance role or particularly useful for preparing reports that may need to go through one or more revisions for producing standard letters and documents. The software provides the capability of insert or delete words, lines or paragraphs and to printout drafts at a higher speed. No matter how many revisions are required full text is typed only once. It may also include special purpose packages such as merging address lists. Purchase orders, producing a range of documents for quotations, dictionary packages with signals and corrects mis-spellings.

·         Desktop publishing. It is a major growth area in the field of office automation. This is not so surprising when you consider the vast quantities of material that business hours publish every (pamphlets, posters etc.)

·         Electronic office. There is a much talk today of the electronic office automation is posturing the evaluation of electronic office in which there is less emphasis as writing and more emphasis on retaining, manipulating and utilizing in electronic form.

·         Banking. Banks work among the first large organization to invest heavily in computing and today almost entire banking system is totally dependent on computers. In the past a large no. of account keeping was handled manually which requires huge labour force and massive volume of book keeping. Computer became necessary because there is no other way to deal with problem. In most instances, the computer is sited centrally where branches are equipped with terminal, giving them online accounting facility enabling them to interrogate the central system for information on such things as current balances, deposits etc., customers are also benefited by computerization of banks through services like ATM’s, online banking. In other words computerization of banking made easier to customers to deal with banks.