Question

What is the utility of core banking?

Hint:

Core banking systems bring banks and customers closer by offering seamless and convenient banking services. Focus on the benefits like accessibility, efficiency, and centralized operations for a complete answer.

Answer 1

Overview:
Core banking refers to the services provided by a network of bank branches that enables customers to perform basic banking functions from any branch within the network, typically through a central system. It has revolutionized the banking sector by providing a unified platform for accessing and managing financial services.
Key Points:
1. 24/7 Access to Banking Services:
Core banking enables customers to access banking services such as withdrawals, deposits, and account management anytime, anywhere, even outside their home branch. It is a significant improvement over traditional banking systems where transactions were limited to a specific branch.
2. Centralized System:
With core banking, all transactions are centralized and recorded in real time across branches. This ensures consistency in the banking operations and enables customers to view their updated balances and transaction history instantly.
3. Improved Efficiency and Customer Service:
Core banking systems streamline banking operations, reducing the chances of errors, fraud, and delays. This improves the overall efficiency of the bank and allows for faster services, such as loan processing and transaction settlement.
4. Cross-Branch Banking:
Core banking allows customers to perform transactions at any branch in the network, enhancing convenience and accessibility. It also facilitates banking through ATMs, online platforms, and mobile apps.