INTERNET

Impact of Internet on Banking and Retail

Impact of Internet on Banking and Retail

Introduction

The explosion of activity that can be seen in the banking and retail industry is the consequence of rapid growth in internet. This growth started back in the year 2000 and there has never been delay. Through it has been over a decade, it seems only like yesterday (Nitsure, 2012, p. 1). Today, the proliferation of internet in the developed as well as developing nations must be understood from the fact that we cannot imagine our lives without it. Is it not common for us to use the term “Google it”? Between this short period of time, the users of internet worldwide have grown from 361 million to 19687 million. The paper discusses the positive as well as negative impacts of this growth in internet on banking and retail industry.

Impact of Internet on Banking

The increase in the use of internet increased the level of competition among commercial banks and led to an improvement in service quality. As customers became more aware of the difference in services offered by competing banks, banks were forced to use novel means of catering to their share of the market to assure customer loyalty. This service improved in two ways. The time that was taken to perform a certain banking task was expedited. This means that the same check that would otherwise take 2-3 days to cash could be cashed via online transfer of funds in a matter of moments (Keeton, 2012, p. 2). In addition, customers now enjoy more convenience for their banking needs than they could have ever imagined before. They can sit at their homes and order food, pay their bills, transfer funds and order their cheque books.

Other than the aforementioned, the proliferation of internet has benefitted banking in terms ...