Banking : Why Computerise ?

A large bank could have several million customers and around 20 million accounts to manage. Every day there could be many transactions (payments and receipts) on each account. Information about each of these transactions must be stored so that the bank has an accurate record of what has happened to the money in each account.

Because of the massive quantity of information that must be dealt with, all banks use computerised information systems to manage customer accounts. A computerised system will provide many advantages over a manual system :

Advantage Details
Storage Space A computerised infomation system can store a massive quantity of information electronically in a small amount of space using a hard disk or other storage device.

Availability of Information Information about every account held at a bank has to be available to all of the banks' employees and customers around the world. A Wide Area Network can be used so that information stored on a central accounts database can be viewed anywhere.
Fast Information Retrieval If account information is stored in a computerised information system then it can be retrieved very quickly if a transaction processing system is used. The details of a particular customer's accounts can be looked up in a few seconds.
Automation When a customer pays for an item using a debit or credit card, money must be transferred from his bank account to the account of the company that he has purchased the item from. A computerised information system can carry out this transfer automatically without the need for human involvement. With hundreds of millions of transfers taking place every day a manual system could not cope.
Security It is important that information about a person's bank account remains confidential and that unauthorised people can not change this information. Computerised security features such as username and password logins and encryption can ensure that the information remains secure.

GCSE ICT Companion 04 - (C) P Meakin 2004