Q: The term ‘Core Banking Solutions’ is sometimes seen in the news. Which of the following statements best describes/describe this term?
a) It is a networking of a bank’s branches which enables customers to operate their accounts from any branch of the bank on its network regardless of where they open their accounts.
b) It is an effort to increase RBI’s control over commercial banks through computerization.
c) It is a detailed procedure by which a bank with huge non-performing assets is taken over by another bank.
The correct answer is 1 only.
Core Banking Solution (CBS)
It can be defined as a solution that enables banks to offer a multitude of customer-centric services on a 24×7 basis from a single location, supporting retail as well as corporate banking activities.
It is a networking of bank branches, which allows customers to manage their accounts, and use various banking facilities from any part of the world. Hence statement 1 is correct.
It is a centralized back-end system that efficiently processes banking transactions across the various branches of a bank.
Core Banking Solution (CBS) helps in speeding up banking transactions and to expand the presence of banking in rural & remote areas.
Statements 2 and 3 are not correct related to the core banking solution.
The centralisation thus makes a “one-stop” shop for financial services a reality. Using CBS, customers can access their accounts from any branch, anywhere, irrespective of where they have physically opened their accounts.
Almost all branches of commercial banks, including the Regional Rural Banks (RRBs), are brought into the core-banking fold.
The e-kuber system can be accessed either through INFINET or Internet. The INFINET is a Closed User Group Network for the exclusive use of member banks and financial institutions and is the communication backbone for the National Payments System.
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