THE BANK MANAGEMENT SYSTEM

SUBMITTED TO

THE SCHOOL OF INFORMATION TECHNOLOGY

MOUNT KENYA UNIVERSITY

BY: AKINYI PURITY.

ADM NO: DIT/2023/67795

A project submitted to the school of pure and applied science; DEPARTMENT OF

INFORMATION TECHNOLOGY in partial fulfillment of the requirement for the award of

a Diploma in Information Technology of Mount Kenya University.

 APPROVAL
I hereby submit this Project Report for Examination with the approval of the project
supervisor.

Signature…………………….………….……….Date………………………………....…

Approved by supervisor

This project has been submitted for review with my approval as university supervisor.

Signature: ……………………………….……… Date: …………………..…

[ii]
 DECLARATION
This project is my own original work and has never been done by anyone before.

NAME: AKINYI PURITY.

ADM NO: DIT/2023/67795.

DATE:………………………..

SIGN:…………………………

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 DEDICATION
I dedicate this project to the almighty God, my entire family and to my friends who have
encouraged and supported me throughout this period when I was developing my project. May
God bless them abundantly.

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 ACKNOWLEDGEMENT
My special gratitude goes to the almighty God who has enabled me to complete this project in
time and also gave me good mind and health.

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TABLE OF CONTENTS.

APPROVAL ...................................................................................................................................................ii
DECLARATION .......................................................................................................................................... iii
DEDICATION .................................................................................................................................................. iv
ACKNOWLEDGEMENT ....................................................................................................................................v
1 CHAPER ONE: INTRODUCTION .............................................................................................................. 7
1.1 Background Information ............................................................................................................... 7
1.2 Global Perpsective ......................................................................................................................... 9
1.3 Statement of the problem ........................................................................................................... 10
1.4 JUSTIFICATION OF THE STUDY..................................................................................................... 11
1.4.1 General Objectives .............................................................................................................. 12
1.4.2 Specific Objective ................................................................................................................ 13
2 CHAPTER TWO: LITERATURE REVIEW ................................................................................................. 14
2.1 Theoretical review ....................................................................................................................... 15
3 CHAPTER THREE: RESEARCH METHODOLOGY .................................................................................... 17
3.1 Study site ..................................................................................................................................... 17
3.2 Study design ................................................................................................................................ 17
3.3 Target Population ........................................................................................................................ 18
3.4 Sample size and determination ................................................................................................... 19
3.5 Data Collection ............................................................................................................................ 19
3.6 Ethical considerations ................................................................................................................. 21

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1 CHAPER ONE: INTRODUCTION

1.1 Background Information

This project was based on the management of the banking system for managing the entire bank

process related to the administration account costumer accounts and to keep each every track

about their property and their various transaction process efficiently. The program mainly

focused on the manipulation of various function like creating account, withdraw/deposit account,

and delete account. The bank management system project is a program that keeps track of a

client's bank account.

It focused on a small bank company called Napa Financial Services. The bank was performing

under the traditional way of banking. The draw backs that was facing the bank’s existing system

is the manual use of inserting employees details, salary details and daily profit or loss details, as

well as lack of competent personnel for financial planning and inadequate methods of evaluating

capital budgeting. With this new system, they were able to find it easy to maintain and implement

their details, count money and send the daily report to the company manager. The bank is located

at my home town and the company’s manager found it reasonable to introduce a computerized

system that would enable them to fasten and improve the day to day activities of the company.

Online banking allows customers of a financial institution to conduct financial transactions on a

secured website operated by the bank. Online banking is an umbrella term for the process by

which a customer may perform banking transactions electronically without visiting a brick-and-

mortar bank.

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Online banking is an activity that is not new to banks or their customers. Banks having been

providing their services to customers electronically for years through software program. These

software programs allowed the user’s personal computer to dial up the bank directly. In the past

however, banks have been very reluctant to provide their customers with banking via the Internet

due to security concerns.

The main reason for the development of this system is to ensure long-term financial stability of

the business. All business start with an aim of making profits and these profits are what makes

the business to be able to meet day to day activities and at the same time make the business

worth-while. How the finances of the business are managed determines the longevity of the

business and its growth. The financial management systems help to keep track of all financial

details in one system. It is therefore very essential for all kind of businesses no matter their size.

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1.2 Global Perpsective

The Bank Management System is an application for maintaining a person's account in a bank. In

this project I indicated the working of a banking account system and cover the basic functionality

of a Bank Management System. To develop a project for solving financial applications of a

customer in banking environment in order to nurture the needs of an end banking user by

providing various ways to perform banking tasks. Also to enable the user’s work space to have

additional functionalities, the Bank Management System undertaken as a project is based on

relevant technologies. The main aim of this project is to develop system for Napa Bank

Company.

This project has been developed to carry out the processes easily and quickly, which is not

possible with the manuals systems, which are overcome by this software. This project is

developed using PHP, HTML , Javascript language and MYSQL use for database connection.

Organization need to effectively define and manage their requirements to ensure they are meeting

needs of the customer. The impact of a poorly expressed requirement can bring a business out of

compliance. Requirements definition and management is an activity that can deliver a high, fast

return on investment. This project analyzes the system requirements and then comes up with the

requirements specifications. It studies other related systems and then come up with system

specifications. The system is then designed in accordance with specifications to satisfy the

requirements. The system is designed as an interactive and content management system. The

content management system deals with data entry, validation confirm and updating whiles the

interactive system deals with system interaction with the administration and users. Thus, above

features of this project will save transaction time and therefore increase the efficiency of the

system.

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1.3 Statement of the problem

. The bank was performing under the traditional way of banking. The draw backs that was facing

the bank’s existing system is the manual use of inserting employees details, salary details and

daily profit or loss details, as well as lack of competent personnel for financial planning and

inadequate methods of evaluating capital budgeting.

With this new system, they were able to find it easy to maintain and implement their details,

count money and send the daily report to the company manager. Hence find it reasonable to

introduce a computerized system that would enable them to fasten and improve the day to day

activities of the company.

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1.4 JUSTIFICATION OF THE STUDY

Through my research, I focused on two banks available in my country. Equity Bank and National

Bank of Kenya, both banks have the following advantages to its customers by offering digital

banking.

 Enhanced security – The digital banking apps are very secure.

 Convenience – Customers can access all digital financial services in one super platform.

 Improved user experience – shorter customer journey, quick access to menus, self service

functions and real time Money Transfer.

 More detailed mini statement –Access an expanded mini statement with more than 20

transactions.

 Offers an expansion of individual transaction details.

 Allows statements to be downloaded – Ability to instantly download your bank account

statement.

 Transaction receipts –download transaction receipts and share them with their beneficiaries

as payment evidence.

 Ability to top-up a card – load a pre-paid card directly from their bank account.

Research shows that both banks face challenges like the speed at which new technologies

become necessary. The size and scale of most bank networks is massive, making them difficult

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to defend. Hackers and cyber thieves constantly change their tactics, and the banks security

measures must move quickly to counter such new threats.

1.4.1 General Objectives

 To develop a project for solving financial applications of a customer in banking

environment in order to nurture the needs of an end banking user by providing various

ways to perform banking tasks.

 Also to enable the user’s work space to have additional functionalities, the Bank

Management System undertaken as a project is based on relevant technologies. The main

aim of this project is to develop system for Napa Bank Company.

 Developed to carry out the processes easily and quickly, which is not possible with the

manuals systems, which are overcome by this software.

 Enable them to fasten and improve the day to day activities of the company.

 Offers an expansion of individual transaction details.

 Allows statements to be downloaded – Ability to instantly download your bank account

statement.

 Transaction receipts –download transaction receipts and share them with their

beneficiaries as payment evidence.

 Ability to top-up a card – load a pre-paid card directly from their bank account.

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1.4.2 Specific Objective

 The main reason for the development of this system is to ensure long-term financial

stability of the business. All business start with an aim of making profits and these profits

are what makes the business to be able to meet day to day activities and at the same time

make the business worth-while. How the finances of the business are managed determines

the longevity of the business and its growth. The financial management systems help to

keep track of all financial details in one system. It is therefore very essential for all kind

of businesses no matter their size.

 These software programs allowed the user’s personal computer to dial up the bank

directly. In the past however, banks have been very reluctant to provide their customers

with banking via the Internet due to security concerns.

 Enable them to fasten and improve the day to day activities of the company.

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2 CHAPTER TWO: LITERATURE REVIEW

Research shows that Banks are very important in allocating savings in an economy and that it can

solve important problems by monitoring depositors and borrowers. They are also important in

directing funds where they are most needed in an efficient manner as well as allowing users to

access to their funds, build their savings, get instant loans, facilitate efficient funds transfer, bill

payments to pay for goods and services and much more.

Through my research, I focused on two banks available in my country. Equity Bank and National

Bank of Kenya, both banks have the following advantages to its customers by offering digital

banking.

 Enhanced security – The digital banking apps are very secure because the data is encrypted

where by none other than you and your bank can understand and read it while it is

transferred across the internet.

 Convenience – There are many common banking tasks you can do without ever

coming into a branch. This freedom is one of the main benefits of online banking.

 Improved user experience – shorter customer journey, quick access to menus, self service

functions and real time Money Transfer.

 More detailed mini statement –Access an expanded mini statement with more than 20

transactions.

 Offers an expansion of individual transaction details.

 Allows statements to be downloaded – Ability to instantly download your bank account

statement.

 Transaction receipts –download transaction receipts and share them with their beneficiaries as

payment evidence.

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 Ability to top-up a card – load a pre-paid card directly from their bank account.

Research shows that both banks face challenges like the speed at which new technologies

become necessary. The size and scale of most bank networks is massive, making them

difficult to defend. Hackers and cyber thieves constantly change their tactics, and the banks

security measures must move quickly to counter such new threats.

2.1 Theoretical review

The overwhelming international acceptance and assimilation of computer system in banking

management in an organization using Kenya Commercial Bank as the case study in different

aspects of life has led to the inevitable creation of a new global economy powered by technology

an economy fueled by information and further driven by knowledge (Tinio 2003;3). The modern

technology has created a path to financial inclusion and a new revenue. The existing pattern of

regional banks to outsource solutions has unlocked a modular system for frictionless experience

and targeted product specialization.

The new regulation that enables open platform and data collection(i.e payment services directive)

has spurred further Fin-Tech expansion. The banking sector India has seen a number of changes.

Most of the banks have begun to take an innovative approach toward towards banking with the

objective of creating more values for customer’s and consequently the banks. E-banking enables

the people to carry out most of their banking transactions using a safe website which is operated

by respective banks. With the emergence of privatization, globalization and liberalization in

India, banks are focusing on Research and development and applying various innovative ideas

and technology.

Financial services around the world continue to feel the impactful change of digital

transformation. Despite the regional differences into financial landscape, common themes and

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standards innovation have developed in unique ways globally. A digital transformation is takig

place in the financial services.

Banking environment has become highly competitive. Today the banking sector undergoing the

process of radical transformation due to excessive competition of foreign and private players and

changes in tastes, preference and habits as well as expectations of customers for newer products.

The traditional view of business which was the right product must be available in the right

product must be right time replaced now by a more dynamic and flexible concept that nay

product should be available anytime and anywhere.

To be able to survive and grow in the changing market environment globally, banks are going for

latest technologies, which is being perceived as an enabling resource that can help in developing

more flexible structure that can respond quickly to the dynamics of fast changing global market

scenario. It is also viewed as an instrument of cost reduction and effective communication with

people and institutions associated with the banking business. Financial institutions have been

computerized for decades, with products such as retail brokerage using digital channels for some

20 years.

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3 CHAPTER THREE: RESEARCH METHODOLOGY

3.1 Study site

The study will be conducted in Nairobi region particularly near the Faulu Bank which used

traditional banking system.This traditional way of banking system has its own limitations on its

services to its customers.

3.2 Study design

This is the framework, or the set of methods and procedures used to collect and analyze data on

variables specified in particular to the research problem.

Examples are:

Variables: A variable represents a measurable attribute that varies across study units, for

example, individual participants in a study, or at times even when measured in an

individual person over time.

The two types of variable form of study design include

 Independent variable: refers to the risk factor whose effect is being studied.

Dependent variable: the outcome variable develops as a consequence of the exposure.

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3.3 Target Population

The target population of the study will be the Faulu Bank Employees and Customers who raised

the issue about how the old system had impact on their day to day work.

This is because the customers are the one who are being affected by the poor traditional way of

banking by the Faulu Bank and they are the one who could give full information that could help

in development of the new system.

The Faulu Bank employees will also play a major role in the investigation by giving a full detail

on how the old system worked particularly on how customer records were stored, how they

were accessed and amount of time it took to serve a customer.

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3.4 Sample size and determination

The research will mainly focus on the employees then followed by picking random customers

for interview. If it happens that a huge number of customers show up, then questionnaires will

be distributed among them.

The researcher will mainly focus to investigate the limitations of the Old system and how they

expect the new system to align with their demands.

3.5 Data Collection

 Interview

As an interviewer, an interchange of views between two people on a topic of mutual interest

,sees the centrality of human interaction for knowledge and emphasizes the situations of the

research data.

The interview was a flexible tool for data collection, enabling multi-sensory channels to be used:

verbal, non-verbal, spoken and heard. The order of the interview may be controlled while still

giving space for spontaneity, and the interviewer can press not only for complete answers but

also for responses about complex and deep issue of the Old Banking system.

 Questionnaire

The questionnaire designed for the study was subjected to a validation for face and content

validity.

In the validation process of this study, copies of questionnaires were given to some individuals

who had experience in the Banking system. The experience individuals went through the

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questionnaire to ascertain the appropriateness and adequacy of the questions in the

questionnaire.

The questionnaires were given out in order to see:

 To determine the workability of the proposed method of the new system to be

developed.

 Whether there is need to include more items in specific areas of the new system to be

developed.

 Observation

This is a way of gathering information by watching behavior, events or noting physical

characteristics in their natural setting.

This method of data collection was used in order to see:

 Monitor or watch the process being studied as it occurs.

 Watch for the results of the traditional banking system.

 If data collected through questionnaires and interviews aligns with the realistic

limitations of the old system being used.

 Understanding better the event and activity being studied.

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3.6 Ethical considerations

This are set of principles that guide the research designs and practices.

 Informed consent

The researcher was fully aware about the study of the research and the purpose of conducting

the study.

 Validity

The questions aked and interviews conducted resulted in the specific alignment of what the

research was about.

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