E- Banking Services

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Erste bank and other Hungarian banks have achieved significant success in the implementation of electronic banking services. There has been a conscious strategy implementation aimed at continuous expansion and improvement of the resources and infrastructure that aids these services in its value creation delivery. The bank and other major Hungarian banks have identified e- business as one of the core strategies for the future developments, but , the bank has not been unmindful of the fact that in her quest in educating clients and creation of awareness that, e- banking acceptance depends on bank’s service quality, safety, security, customer education and satisfaction. Reforms and restructuring of the banking (from a centrally managed – mono- banking by state ownership to a market based private ownership) system in Hungary has had significant impact on the macro- economic stability of Hungary. The reforms had a functional impact in two major ways-. (i) it enabled the state owned mono- bank National bank of Hungary (NBH),focus primarily on its statutory function as the ‘Regulator’(central banking) of all banking activities in Hungary thereby divesting itself of commercial banking functions.(ii) Privatization of state owned banks has strengthened and stabilized the banking system in Hungary. The new owners (ERSTE Bank included) and investors has injected the needed capital, technology, and know-how into the system. The Privatization strategy has also made Hungarian banks stronger and more competitive, providing banks clients with variety of options (in terms of services). SWOT (Strengths, Weakness, Opportunities and Threats) analyzes identifies the ‘Strengths’ and ‘Opportunities’ to include : improved service delivery, savings in running costs, creation of new jobs, quality services, increased awareness to exploit cost effective way to deliver value, opportunities to grow market share due to improved technology, opportunities to create and innovate new products. The ‘Threats’ and ‘Weaknesses’, includes: continual changing technology, competition from lower price operations, continual wants of customer wants and needs, security of hacking system, risk of fraud and cyber crimes, legal risks, hostile feelings of employees due to possible pending layoffs due to automation, threat of new entrants etc. The analysis of results presented in this paper is based mainly on Questionnaire (distributed among Hungarian and International Students were collated), and informal personal interviews with specialists in e- banking development in Hungary. Finally, the benefits of e- banking are analyzed from the point of view of banks, their customers and the economy in general. The paper demonstrates that e- banking is not a niche application to computer fans and innovative adopters rather, profound researches are continuously needed to map its consumer base and the impact of e- banking on development of bank-customer relations in the value creation delivery.