ELECTRONIC SERVICES DELIVERYE-commerce is about buying and selling information, products and services via computer networks such as the internet and Electronic Data Interchange (EDI).
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- Communications: e-commerce is the delivery of information, products/ services, or payments over telephone lines, computer networks, or any other electronic means.
- Business process: e-commerce is the application of technology towards the automation of business transaction and workflow.
- Service: e-commerce is a tool that addresses the desire of firms, consumers, and management to cut service costs while improving the quality of goods and increasing the speed of service delivery.
- Online: e- commerce provides the capability of buying and selling products and information on the internet and other electronic channels such as Electronic Data Interchange (EDI).
- Different and arguably lower barriers to entry;
- Opportunities for significant cost reduction
- More Choice;
- Better value for money obtained through greater competition;
- More information;
- Better tools to manage and compare information;
- Faster service.
FROM E-COMMERCE TO E- BANKINGIn its very basic form, e –banking can mean the provision of information about a bank and its services via a home page on the World Wide Web (www). A more sophisticated internet based service provides the customer with access to their accounts, the ability to move money between different accounts, make payment or apply for loans and other financial products. The term e – banking will be used in this book to describe the all types of provision of financial service by an organization to its customers. Such customer may be an individual or another business firm. To understand the electronic distribution of goods and services, the work of Rayport and Sviokla (1995)51 is a good starting point. They highlight the differences between the physical market place and the virtual market place, which they describe as an information defined arena. In the context of e – banking, electronic delivery of services means a customer conducting his transactions from a remote location (e.g. home) rather than visiting a local branch. Automated Teller Machines (ATMs) were the first means of providing electronic access to retail customers, made possible through the introduction of customer networks. Telephone banking arrived next, which was a revolutionary concept since it made banking possible from anywhere as long as telephones were available. In the mid eighties, online banking arrived. In its early form, ‘online banking services’ requires a computer, modem and software provided by the financial services vendors. Generally, these services failed to get widespread acceptance due to high call costs and unfairly system interfaces, and were discontinued by most providers. With the arrival and widespread adoption of The World Wide Web, banks renewed their interest in this area and started developing a web presence. The goal was for a bank’s website to provide many, if not all, of the services offered at a branch. This may include transactions as well as information, advice, administration, and even cross – selling. However, the interactive nature of the web not only allows banks to enhance these core services, but also enables banks to communicate more effectively and expand customer related relationships. When combined with the improving analytical capabilities of data mining and technologies, the potential for enriching the relationship with customers is unlimited. Most banks and other financial institutions in the developed world have established an internet presence with various objectives. Some banks are there because their competitors have done it. Others prefer a ‘wait and see’ practice. Some are using it as a banking channel being part of their distribution /delivery management. E–banking largely came into being as a result of technological developments in the field of computing and communications but there have been a number of other factors or challenges which played an important part in its development. According to Jayawardhena and Foley (2000) 52 the challenges for banks are fourfold. First, they need to satisfy customer requirements that are complex and ever changing. Second, they need to deal with increased competition from old as well as new entrants coming into the market. Third, they need to address the pressures on the supply chain to deliver their services quickly. Finally, they must continually develop new and innovative services to differentiate themselves from the competition, as having a large branch network is no longer seen as a main source of competitive advantage
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