Law and Regulation of Electronic Finance and Internet Banking

Law and Regulation of Electronic Finance and Internet Banking

During the last twenty years the world has witnessed a drastic change onto the way business is conducted, services are rendered, products are sold and communications handled. Indeed, the technology revolution has had a profound and irreversible impact on the way the world is moving and interacting whereby the new technologies provided for cheaper, (Cronin 1997) easier and faster solutions to the traditional way of living. Nowadays, most people are familiar with new expressions such as e-services, e-commerce, e-government, B to B (Business to Business) B to C (Business to Consumer), etc… I would recall that only four or five years ago the mere use of one of these expressions would generate a very obvious panic for lawmakers, government entities and both judges and lawyers as well. (Cronin 1997)

The question was then basically revolving around how to accommodate such developments in already existing laws and how to regulate this new world that started to become as important as the real world from a concrete and clear legal perspective. One cannot say that all new issues are now resolved and that solutions are today available on hand, however, one should recognize the tremendous efforts and profound legal developments that started to affect the new ways of conducting business through the use of new technologies. (Cronin 1997)

Though such technologies have affected a very substantial and wide array of business activities, the legal challenges displayed by the introduction and use of new technological means to both, banking and financial services might be one of the most defying tasks confronting the international business and legal communities which has already required substantial amounts of discussions, debates and lots of ink, and which is promising to ask for more. (Cronin 1997)

E-banking and financial services refer to systems that enable banks and financial institutions' customers to access accounts and general information on bank and financial products and services through a personal computer (PC) or other intelligent device. E-banking products and services can include wholesale products for corporate customers as well as retail and financial products for consumers. Ultimately, the products and services obtained through e- banking may mirror products and services offered through other bank delivery channels. Examples of e-banking and financial services may include:

Cash management

Wire transfer.

Automated clearinghouse (ACH) transactions.

Bill presentment and payment.

Balance inquiry.

Funds transfer.

Downloading transaction information.

Bill presentment and payment.

Loan applications.

Investment activity.

Other value-added services. (Cronin 1997)

Banks have experienced various forms of online banking for many years. The Internet, as an enabling technology, has made banking and financial products and services available to more customers and eliminated geographic and proprietary systems barriers. With an expanded market, banks and financial institutions may also have opportunities to expand or change their product and service offerings. (Cronin 1997)

Indeed, as banks and financial institutions have in their vast majority introduced new technologies for the delivery of their services, a multitude of issues have been raised, the dealing with which shall be one of the most interesting and ...