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The Evolution of Internet Banking

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Since the year 2010, not so long ago in human history but quite outdated in technological terms, the banking sector underwent a shift to a new era where banking has become as easy as the tap of a button on your smart phone. What we call internet banking today, has gone through an incredible development journey that goes back to the 1970s…   Let us explore this journey and highlight the key milestones of internet banking.

If you think of how long the term banking has been accompanying the human history, you’d probably say that 2010 seems incredibly recent. To put it into perspective, it is said that banking started around 2000 BC when merchants loaned out grain to farmers and traders that moved goods between cities, in the Assyrian and the Sumerian Empires. Later, it was adopted by civilizations like Ancient Greece, China, and the Roman Empire over different eras in history.

To further explain what banking is today,  let’s dive into the roots of banking,  money... The first banknote is said to have appeared in the 7th century during the era of the Tang Dynasty of China. Essentially, it was used by merchants who wanted to avoid the heavy and bulky copper coins during large transactions. Like an I Owe You (IOU) those bank notes were used to state what a person owns, but instead of carrying the coins around, they got a note that states that they own an amount of copper coins instead. The banknote was widely adopted amongst the Chinese merchants which contributed to an economic boom for the Chinese during the era.

The Roman Empire, one of the superpowers of its time, is considered the pioneer of today’s banking system. The first institutional bank, rather temple, was attributed to the Roman Empire to manage government expenditures, lending, commerce, and changing of money. According to the world history encyclopedia, Julius Ceasar is the first issuer of the edict that allows banks to confiscate land if the loanee fails to pay his/her debts. However, banking in its modern sense is said to have started as late as the 14th century in rich northern Italian cities such as Florence.

The development of the banking industry continued hereafter with a few milestones in the 16th and the 17th century where the basic bank functions such as accepting deposits, moneylending, business loans, and estate development loans started to become traditional banking functions. In the broader sense of the word, commercial banking was born. With the birth of commercial banking, governments saw a need for a way to manage the customer-bank relationships and with that need came central banks alongside laws and policies that govern the banking industry.

Fast forward in history to 1981, the first ever “Online Banking” was made available to customers by four major US banks in New York City (Citibank, Chase Manhattan, Chemical Bank, and Manufacturers Hanover). Online is overstated here, it was more like Home-banking, connecting through the telephone lines internet, yes dial-up 56 kbps internet. Two years later the Bank of Scotland UK made available United Kingdom’s first online banking services, where customers would connect through telephone internet to pay bills and transfer money.

The 80s set the corner stone in what we now know as internet banking / online banking. However, it wasn’t until the late 90s that the public started to pick up on the benefits of internet banking, where internet banking became a major trend, not as advanced as today, but being able to access your account balance online was revolutionary, as well as some other functions, such as offering product catalogs and showcasing services online.

With the huge wave of banks adopting internet banking, a new type of banking was born – Internet Banking – with the establishment of the Bank of Internet USA in 1996, and the founding of NetBank in 1999 which is considered the first truly successful “internet only” bank, it was clear to the public that internet banking had major benefits over its counterpart traditional ‘brick and stone’ banking. We’re talking higher interest rates, greater access to accounts, and online banking transfers, to name a few.

The early 2000s were the years of innovation, almost every major company that’s related to the financial sector around the globe was adopting this new trend. A shift in the money system of the world happened, a shift that saw the founding of Netiks International in 2000, the launch of Netiks Retail e-Banking in 2003. (follow this link if you want to learn more

Our Internet Banking YouTube Video:

In 2010 a survey, Fiserv conducted a survey on the consumer billing and payments trends only to find out that internet banking is growing faster than the internet. Major innovations, notably iOS and Android, enabled internet banking to enter a new era, where dedicated internet banking applications made their first appearances; a fully-fledged mobile and tablet internet banking solution was developed by Netiks in 2010, marking Netiks International as one of the pioneers of the industry in general, and mobile banking specifically, in line with major banks around the world.

With a rapidly increasing competition and demand for innovation, Online Banking became the norm. We at Netiks are key players in the online banking industry, developers of major local and international online banking applications, adopting rapid shifts in business technologies such as Artificial Intelligence, Customer Relationship Management (CRM) and closing the loop for the banking industry with products like 360Bank (2012) a CRM vertical for the banking sector, Netiks Omnichannel in 2014, Genetiks Chatbot in 2018 and Genetiks AI in 2019.

It is astounding to think how recent these breakthroughs made their way to become “the normal” for every individual on the planet, while the future holds even more breakthroughs driving the banking industry toward virtual reality or holograms resulting in augmented banking but definitely real money !




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