The bank is looking for new clients in high-growth industries. Until a few years ago, if a consumer wished to purchase music, he or she would have to buy a recording of it at a store, but there is only a limited supply of compact discs, tapes, or records at any given store. Because of advancements in technology, consumers can now download music with virtually no restrictions on supply. Your manager has asked you to identify a product, aside from the music industry itself, which has experienced a dramatic increase in supply because of technological advancements. What has happened to the variety and price of those products?

Computer generated technology is now found at every step and every avenue of ones life; at home; at school; at office, on the street; at hospital, the use of cell phones; smart cards; lasers; weapons; traffic systems; banking; transport and numerous more areas are dependant on this invention. Life has been invaded and continues to be inundated by this, on the one hand easier, yet the increasing dependence is affecting man in many ways.

 A new era of technological advancements has begun and is dramatically changing and affecting our lives and businesses. With instant transfer of news and information, speedy travel, the concept of time and space is merging with virtuality. Crossing of time zones and geographical boundaries in seconds is changing concepts of communication.

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« Online Business and the World Wide Web
Internet Banking: Then and Now »

The banking industry has experienced a vividly striking and huge boost due to technological advancements. Almost all banking transactions are now carried out via computerization, be it money transfer; be it account information; be it cashing or depositing; be it dissemination of information to clients, everything is now a click away. Along with this there has been a gigantic rise in the sales level and operational clients available for the banking industry. Due to internet and ecommerce services a whole new target market is now available for the banks. In addition, the introduction of internet and ecommerce had lead to launch of new products, product customization and banks stepping into the insurance business, leading to both vertical and horizontal expansion of the banks.

On the other hand it has also changed the banking procedures for existing customers as now more and more people access their accounts and handle transaction through online banking, instead of doing it the other way. This not only makes its easier for them but also saves time on both ends, thus making it more viable.  Also now thorough new technology of credit cards, debit cards and ATM cards; handling and transportation of money is no more a difficult task. In fact it has in effect given rise to the number of investments and depositing into the bank as now one can withdraw cash from almost any part of the world. As this fear reduces in people’s minds, they are more willing to use other bank provided services, thus improving business potential for banks.

Also it would be unfair not to mention the benefits of technology in banking with respect to rural areas. Technology has played a significant role in diminishing the large gap between the rural and urban banking industry. At the same time, technology is also likely to augment the penetration of banking sector to increase the reach of banking products and services to the large rural population in future. Previously banks were not able to effectively target the rural population but now through modern technology it has become far easier to provide banking services to the farthest of the areas. This has also seen a sharp rise in the number of loans granted by banks to the population of rural areas, thus not only introducing the banking system to these areas but also effectively penetrating and capturing a reasonable market share.

Another aspect is that as new technology has been introduced it has catalyzed the fierce competition between the banks. In a bid to capture the largest market share through the new cut throught technology, banks have introduced new and easy terms for their services. This has also led to a sharp fall in prices so as to attract more customers. As a result Commercial banks have increased their share of the market, rising from 23.7% in 2001 to 28.6% in 2008.Also growth has been highest from diversified financial products whose market has rose at an average annual growth rate (AAGR) of 9.9% through 2006, while commercial banks have increased their share to 19.1% from 16.4%.