Log in ....Tribune

Monday, December 29, 2003 		Feature

Wanted! Data software
S.C. Dhall

CHANGING competitive environment in banking industry has forced the Indian banks to go in for optimum use of public infrastructure (the Internet), industry-specific infrastructure (the Infinet) and bank-specific communication network (create through VSAT). Huge investments for creating and using these infrastructure-based facilities (except the Internet) have significant implications for optimisation of returns on investments in information technology. An example of optimisation of returns on information technology is that world-class corporations use a systematic approach to IT to ensure it supports both business needs and knowledge management needs. According to a survey conducted elsewhere in the world, a corporation called LLC (a leading chemical manufacturer) credited its knowledge management system with $1 million in savings during the first year of use. Knowledge-based organisations experience about 20 to 30 per cent employee turnover. When employees leave the organisation, knowledge is lost forever and unless proper technology to capture, store and recycle the acquired information is in place, such organisations may face loss.

When such is the potential of information technology, it makes business sense that the ‘Core Banking Solution’ that is being talked about in Indian banking industry should provide a comprehensive IT solution that is easily upgradeable and helps the banks in eliciting and supporting knowledge creation, knowledge sharing, and knowledge refinement on a continuous basis.

To save on costs, industry specific organisations like the Indian Banks’ Association and the Indian Institute of Bankers could consider using public infrastructure like the Internet for disseminating world-class knowledge and skills. This step will not only help the banks in saving the huge costs incurred in sending bank personnel abroad or in India for attending expensive training programmes but would also facilitate asynchronous learning (anytime and anywhere learning, i.e. learning at a pace of choice).

Bank-specific IT infrastructure, among other things, should have the potential to:

a) Capture data information from all locations.

b) Process and aggregate data for reuse.

c) Provide online information to the CEOs, controllers and other functionaries about all branches and their business profile.

d) Help customers in knowing the products and services of a bank in all its dimension and answer queries online.

e) Facilitate top-bottom and bottom-top communication in all areas of bank management.

f) Provide a user-friendly search engine to all staff members to get the required feedback, which can improve staff’s professional behaviour and decisions.

Banks gear up to tackle ‘phishing’

BANKING officials and computer security experts have predicted the wave of cyber scams targeting the financial services sector will soar in 2004 as the industry braces for a new onslaught of fraud schemes.

The gloomy prediction comes amid a string of e-mail and Website spoofing scams preying on banking customers.

Police call the relatively new phenomenon "phishing", so named because fraudsters try to lure unwitting customers into divulging their bank details.

In the past few months, a rash of e-mails posing as correspondence from some of the world’s biggest banks have flowed into various e-mail in-boxes. The scams have been reported in Britain, the United States and Australia, to name a few.

"We see phishing as just the toe in the water," said a security expert for one of the UK’s largest banks who spoke on condition of anonymity at a summit in London dedicated to security matters in the financial services industry.

"It’s like credit card fraud. Phishing is not big yet. But it will be."

Banks, desperate to protect their reputation and preserve a fast-growing segment of their business, consider online fraud schemes a top security issue.

"The level of concern among our customers about the risk is certainly on the increase," said Nick Sears, vice-president of sales for Finjan Software, a California-based security firm that counts some large banks as its customers.

British banks have been particularly hard hit this fall with more than a half-dozen firms, including Barclays Plc, Lloyds TSB and NatWest, posting warnings to customers that they have been the target of fraudsters.

Experts said, the best defence lies with the customer.

"At the end of the day, the customer has got to start being more aware of what they’re doing online. If somebody came up to you on the street and asked you for your credit card, you’re not going to give it away. Why would you listen to an e-mail?" the bank security expert said.

Police blame the crime wave on organised crime syndicates based in Eastern Europe and other regions where law enforcement is ill-equipped to investigate the cases.

Meanwhile, the industry has been scrambling to find a fix of its own. One suggestion is the creation of a "dot-bank" Web domain that would be distributed solely to financial services companies.

A main problem, law enforcement officials say, is that fraudsters can easily acquire a dot-com Website address that looks like an authentic business Web address.

— Reuters