Sydenham College of Commerce

SYDENHAM COLLEGE OF COMMERCE & ECONOMICS
ACADEMIC YEAR 2015-16

Bachelor of Management Studies (Semester Fourth)
NAME: DEEPALI MADHU BHOIR

ROLL NO: 1123
SUBJECT: ADVANCED COSTING & AUDITING
PROJECT TOPIC: STUDY OF CORE BANKING SOLUTION IN INDIA
CERTIFICATE
This is to certify that MS.DIPALI MADHU BHOIR of SYBMS-B Semester IV [Batch 2016
2017] has successfully completed the project on STUDY OF CORE BANKING SOLUTION IN
INDIA topic of project under the Guidance of Professor NIKITA RATHOD.
Project Guide: Nikita Rathod

Date: ___________
Place: Mumbai
Sr. No.
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INDEX
Particulars
Introduction
Elements of Core Banking
Core Banking Solution(CBS)
Objectives of Core Banking Solution
Needs of Core Banking Solution
Benefits of Core Banking Solution
Conclusion
Bibliography
Page No.
ACKNOWLEDGEMENT
First of all immensely and wholeheartedly I thank God and also my parents for
giving me this opportunity for successful completion of my project work. Also I
thank the management for giving us a chance for doing this course.
I wish to express my sincere thanks to all my teachers, for the continuous and
creative ideas, given during my studies and also for this project. I am deeply
indebted to my mentor, my guide and my respected teacher MS.NIKITA
RATHOD, for his patience, valuable inputs, motivations to perform more better
and his instincts support without which the project work would not have
completed.
I am extremely indebted to the internet technology for the valuable help rendered
to me by providing the necessary materials and support needed for the preparation
of this project work.
INTRODUCTION
Core Banking is a banking service provided by a group of networked bank
branches where customers may access their bank account and perform basic
transaction from any of the member branch offices. Core banking is often
associated with retail banking and many banks treat the retail customers as their
core banking customers. Businesses are usually managed via the Corporate
banking division of the institution. Core banking covers basic depositing and
lending of money. Normal Core Banking functions will include transaction
accounts, loans and payments. Banks make these services available across multiple
channels like ATMs, Internet banking, mobile banking and branches. The core
banking services rely heavily on computer and network technology to allow a bank
to centralize its record keeping and allow access from any location. It has been the
development of banking software that has allowed core banking solutions to be
developed. Core banking became possible with the advent of computer and
telecommunication technology that allowed information to be shared between bank
branches quickly and efficiently.
Before the 1970s it used to take at least a day for a transaction to reflect
in the account because each branch had their local servers, and the data from the
server in each branch was sent in a batch to the servers in the data center only at
the end of the day (EOD). Over the following 30 years most banks moved to core
banking applications to support their operations where CORE Banking may stand
for "centralized online real-time exchange". This basically meant that all the bank's
branches could access applications from centralized data centers. This meant that
the deposits made were reflected immediately on the bank's servers and the
customer could withdraw the deposited money from any of the bank's branches.
ELEMENTS OF CORE
BANKING
Making and servicing loans.

Opening new accounts.
Processing cash deposits and withdrawals.
Processing payments and cheques.
Calculating interest.
Customer relationship management activities.
Managing customer accounts.
Establishing criteria for minimum balances, interest rates, number of
withdrawals allowed and so on.
Establishing interest rates.
Maintaining records for all the banks transactions
CORE BANKING SOLUTION

Core banking solution is the process which
is completed in a centralized environment that is under which
information relating to the customers account that is financial
dealing, profession, income, family members etc. This information
is stored in the Central Server of the bank that is available to all
the networked branches instead of the branch server. The word
Core in Core Banking Solution stands for Centralized Online Real
Time Environment. Depending upon the size and needs of a bank,
it could be for the all the operations or for limited operations. This
task is carried through an Advance Software by making use of the
services provided by specialized agencies.
Core banking solutions is jargon used in banking circles. The
advancement in technology, especially Internet and information
technology has led to new ways of doing business in banking.
These technologies have reduced manual work in banks and
increasing efficiency. The platform where communication
technology and information technology are merged to suit core
needs of banking is known as core banking solutions. Here,
computer software is developed to perform core operations of
banking like recording of transactions, passbook maintenance,
interest calculations on loans and deposits, customer records,
balance of payments and withdrawal. This software is installed at
different branches of bank and then interconnected by means of
computer networks based on telephones, satellite and the
internet. It allows the banks customers to operate accounts from
any branch if it has installed core banking solutions.
OBJECTIVES OF CORE BANKING

SOLUTION
To increase the number of customers.
To provide multiple delivery channels like internet, mobile
banking, ATMs, thereby bringing access to financial services to
the doorsteps of the customers.
To enable faster money fund transfers to reach out to more
customers.
To become one stop solution for financial inclusion initiatives of
the Government of India.
NEEDS FOR CORE BANKING SOLUTION

Improve operational efficiency
Core Banking will provide various alternative delivery service channels,
which reduce cost and time taken for the transactions. Currently banks
counter transaction costs are around Rs. 45-50 per transaction. On the
other hand, the transaction cost of withdrawal from an ATM is Rs. 15-18.
For net banking, the cost is Rs. 4 per transaction. The centralized process
of core banking will also improve efficiency by avoiding duplication of work
in post offices from Branch Office (BO) to Sub Post Office (SO) to Head
Post Office (HO)
Improve customer service

Core Banking will improve customer services by providing services through
alternate channels on 24 x 7 basis ATM, Internet, Phone, SMS and Mobile
Banking. Customers would be able to operate their accounts, and avail
banking services from any post office on CBS network, regardless of where
they maintain their account.
Know Your Customer (KYC) requirements

It is easy to comply with antimoney laundering norms through core
banking. The AML norms require the post office to detect when a customer
has opened multiple accounts. This is not possible in Sanchay Post.
Moreover, compliance with KYC norms is required to issue debit cards to
the customers.
Integrate with electronic payment systems

Integration with electronic payment systems will allow Department of Post
to participate in an inter-operable electronic payment network run by the
National Payments Corporation of India. This help in quick and safe
transfer of funds through National Electronic Fund Transfer and Real Time
Gross Settlement.
BENEFITS OF CORE BANKING SOLUTION

Anytime and Anywhere banking (online mediums / SMS).
Standardized, simple and automated processes.
Increase in quality of the service provided to the customers.
Timely and accurate information for management decision making.
Strong audit and internal controls.
Bring down the cost of transaction and thereby improving operational
efficiency.
Paving way for new value added services thereby generating
additional revenue for the Department.
CONCLUSION
Core banking solutions (CBS) help automate front-end and back-end
processes of banks to achieve centralized and smooth processing. These
applications offer a single view of the customer and facilitate automation across
delivery channels. The concept of CBS has helped banks become one-stop shops for
all the financial needs of retail and corporate customers by offering multiple
services under one roof. Thanks to CBS implementation, customers can now access
their accounts from any branch of their bank, irrespective of which branch the
account was opened at.
BIBLIOGRAPHY
https://en.wikipedia.org/wiki/C
ore_banking (28.2.2016)
http://www.bankingawareness.com/te
rminology/core-banking-solutionscbs/ (28.2.2016)

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SYDENHAM COLLEGE OF COMMERCE & ECONOMICS

ACADEMIC YEAR 2015-16

NAME: DEEPALI MADHU BHOIR

Project Guide: Nikita Rathod

Making and servicing loans.

CORE BANKING SOLUTION

OBJECTIVES OF CORE BANKING

NEEDS FOR CORE BANKING SOLUTION

Improve customer service

Know Your Customer (KYC) requirements

Integrate with electronic payment systems

BENEFITS OF CORE BANKING SOLUTION

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