CHIPS

 The Clearing  House  Interbank  Payments  System (CHIPS)  is  the  main  privately  held clearing  house for  large-value transactions in the United States, settling well over US$1 trillion a day in around 250,000 interbank payments. Together

with the Fed wire Funds Service (which is operated by the Federal Reserve Banks), CHIPS forms the primary U.S. network for large-value domestic and international USD payments (where it has a market share of around 96%). CHIPS transfers are governed by Article 4A of Uniform Commercial Code.

CHIPS  is  owned  by financial  institutions.  CHIPS  participants  may  be  commercial  banks, Edge  Act corporations  or investment companies. Until 1998, to be a CHIPS participant, a financial institution was required to maintain a branch or an agency in New York City. A non-participant wishing to make international payments using CHIPS was required to employ one of the CHIPS participants to act as its correspondent or agent.

Banks typically prefer to make payments of higher value and of a less time-sensitive nature by CHIPS instead of Fed wire, as CHIPS is less expensive (both by charges and by funds required).

CHIPS differs from the Fed wire payment system in three key ways. First, it is privately owned, whereas the Fed is part of

a regulatory body. Second, it has 47 member participants (with some merged banks constituting separate participants), compared with 9,289 banking institutions (as of March 19, 2009) eligible to make and receive funds via Fed wire. Third, it is a netting engine (and hence, not real-time).

Only the largest banks dealing in U.S. dollars participate in CHIPS; about 70% of these are non-U.S. banks. Smaller banks have not found it cost effective to participate in CHIPS, but many have accounts at CHIPS-participating banks to send and receive payments.

Cash Memory

 Cache (pronounced cash) memory is extremely fast memory that is built into a computer’s central processing unit (CPU),

or located next to it on a separate chip. The CPU uses cache memory to store instructions that are repeatedly required to run programs, improving overall system speed.

The advantage of cache memory is that the CPU does not have to use the motherboard’s system bus for data transfer.

Whenever data must be passed through the system bus, the data transfer speed slows to the motherboard’s capability. The CPU can process data much faster by avoiding the bottleneck created by the system bus. When the processor needs to read from or write to a location in main memory, it first checks whether a copy of that data is in the cache. If so, the processor immediately reads from or writes to the cache, which is much faster than reading from or writing to main memory.

Disadvantage of the Cache: Just in case the Cache memory is full and data that is required to process or an application required to run doesn't fit into the Principle of Locality (that is not in the nearby location) then it is obvious that the time required for the main memory to access the information would increase. Because, first the data need to be relocated into the cache and then process over here if the cache memory was missing it would be quicker. Furthermore being such an extensive memory they are very small in size which requires location and relocation of the data or applications. It allows commonly accessed data to be stored in full and referenced faster than recompiling the data each time.

Business Continuity Planning (BCP)

 Business Continuity Planning (BCP) is an interdisciplinary concept used to create and validate a practiced logistical plan for how an organization will recover and restore partially or completely interrupted critical functions within a predetermined time after a disaster. The logistical plan is called a Business Continuity Plan. It ensures fast recovery from technical disaster i.e. e-IBS server failure, database crash.

A  Business  continuity  planning (BCP)  identifies  an  organization's  exposure  to  internal  and  external  threats  and synthesizes hard and soft assets to provide effective prevention and quick recovery for the organization, while maintaining competitive advantage and value system integrity.

A business continuity plan outlines the steps necessary for a company to operate in the wake of a sudden and severe change to market conditions. Continuity plans can address basic concerns, such as the chain of command in the event a company leader dies or becomes extremely ill. Likewise, continuity plans reveal backup strategies for drastic scenarios, such as labor disputes, patent lawsuits or distribution bottlenecks.

Benefits

A comprehensive business continuity plan forces leaders to review the weaknesses and threats to their organizations from a detached perspective. While few business leaders want to focus on negative "what if" questions, the process of creating  a  continuity  plan  can  raise  concerns  about  employee  development,  real  estate  selection  and intellectual property security. Tight plans can assure teams that company leaders understand how to turn on a dime during challenging times.

The pivotal role that banking sector plays in the economic growth and stability, both at national and individual level, requires continuous and reliable services. Increased contribution of 24x7 electronic banking channels has increased the demand to formulate consolidated Business Continuity Planning (BCP) guidelines covering critical aspects of people, process and technology.

BCP forms a part of an organization’s overall Business Continuity Management (BCM) plan, which is the “preparedness of an organization”, which includes policies, standards and procedures to ensure continuity, resumption and recovery of critical  business  processes,  at  an  agreed  level  and  limit  the  impact  of  the  disaster  on  people,  processes  and infrastructure  (includes   IT);  or  to  minimize  the  operational,  financial,  legal,  reputational  and  other  material consequences arising from such a disaster.

Effective business continuity planning is an important component in managing operational risk.  Financial institutions and their TSPs should develop, implement, and test appropriate disaster recovery and business continuity plans capable of maintaining acceptable retail payment-related customer service levels.  Business continuity plans should be based on business impact analyses and the relative importance of retail payment system products and services to the financial institution.

For financial institutions offering basic retail payment products and services (e.g., bankcard issuance, check item processing,  branch  ATM  access,  Internet  banking  services),  business  continuity  plans  should  include  appropriate recovery targets for each retail product.  The recovery targets should consider the reliance on any third-party servicer in meeting their objectives.  Vendor management programs should include provisions for the disruption and restoration of service at service providers, including the consideration of service provider test plans.

For financial institutions and service providers with complex retail payment operations, business continuity plans should enable  restoration  of  service  within  timeframes  that  are  reasonable  for  internal  business  units,  other  dependent financial institutions, and counterparties.  Financial institutions providing significant card issuing, merchant processing, EFT/POS, ACH, and retail payment-related Internet banking services should also test these plans periodically with customer financial institutions and counterparties to ensure plans are sufficient.

BATCH PROCESSING

 Batch processing is execution of a series of programs ("jobs") on a computer without manual intervention. Jobs are set up so they can be run to completion without manual intervention, so all input data are preselected through scripts, command-line parameters, or job control language. This is in contrast to "online" or interactive programs which prompt the user for such input. A program takes a set of data files as input, processes the data, and produces a set of output data files. This operating environment is termed as "batch processing" because the input data are collected into batches of files and are processed in batches by the program.

Benefits:

• It can shift the time of job processing to when the computing resources are less busy.

• It avoids idling the computing resources with minute-by-minute manual intervention and supervision.

• By keeping high overall rate of utilization, it better amortizes the cost of a computer, especially an expensive one.

•  It allows the system to use different priorities for batch and interactive work.

 

BEFTN

Bangladesh Electronic Funds Transfer Network (BEFTN) is the processing and delivery center for the distribution and settlement of electronic debit and credit transactions among its participants. The BEFTN is envisaged as a system of participating banks connected with  the  EFT  Operator  via communication lines.  The Network will start with credit transactions and gradually progress to debit transactions. This will dramatically bring down the operational cost, reduce risk and will increase the efficiency of the payments process. BEFTN has started its 'Live Operation' on 28th February

2011 with the objective to decrease paper-based payment methods and encourage paper-less payment methods for secured, faster & cost-effective transactions especially at the corporate levels. The Network started with credit transactions and started debit transactions from 15 September 2011.

BEFTN facilitates the transmission of payments between the banks electronically, which makes it faster and efficient means of inter-bank clearing over the existing paper-based system i.e. BACPS. It is able to handle a wide variety of credit transfers such as payroll, foreign and domestic remittances, social security, company dividends, retirement, expense reimbursement, bill payments, corporate payments, government tax payments, veterans payments, government license fees and person to person payments as well as debit transfers such as mortgage payments, membership dues, loan payments, insurance premiums, utility bill payments, company cash concentration, government tax payments, government licenses and fees.

Participants in BEFTN

The EFT Network is a multilateral electronic clearing system in which  electronic  payment  instructions  will  be  exchanged among Scheduled Banks. The system involves transmitting, reconciling and calculating the net position of each individual participant   at   the   end   of   each   processing   cycle.   The participants involved are:

(a) Originator.

(b) Originating Bank (OB)

(c) Bangladesh Electronic Funds Transfer Network (EFT Operator) (d) Receiving Bank (RB)

(e) Receiver

(f) Correspondent Bank

ATM has made our life easy

 An automated teller machine (ATM), also known as automatic banking machine (ABM), Cash Machine, or Cashpoint, is a computerized telecommunications device that provides the clients of a financial institution with access to financial transactions in a public space without the need for a cashier, human clerk or bank teller. It allows the bank clients for banking services round the clock i.e. 24 hours. On most modern ATMs, the customer is identified by inserting a plastic ATM card with a magnetic stripe or a plastic smart card with a chip that contains a unique card number and some security information such as an expiration date or CVVC (CVV). Authentication is provided by the customer entering a personal identification number (PIN).

Services Offered by ATMs:

I.            Cash deposit/ cash withdrawal

II.           Balance inquiry

III.          Fund transfer

IV.         Standing instruction

V.          Utility bill payment

VI.         Making payments for application for IPOs

Advantages of ATMs:

1.   ATM provides 24 hours service: ATMs provide service round the clock. The customer can withdraw cash up to a certain a limit during any time of the day or night.

2.   ATM gives convenience to bank's customers: ATMs provide convenience to the customers. Now-a-days, ATMs

are located at convenient places, such as at the air ports, railway stations, etc. and not necessarily at the Bank's premises. It is to be noted that ATMs are installed off-site (away from bank premises) as well as on site (installed within bank's premises). ATMs provide mobility in banking services for withdrawal.

3.   ATM reduces the workload of bank's staff: ATMs reduce the work pressure on bank's staff and avoids queues in bank premises.

4.   ATM provides service without any error: ATMs provide service without error. The customer can obtain exact amount. There is no human error as far as ATMs are concerned.

5.   ATM is very beneficial for travelers: ATMs are of great help to travelers. They need not carry large amount of cash with them. They can withdraw cash from any city or state, across the country and even from outside the country with the help of ATM.

6.   ATM may give customers new currency notes: The customer also gets brand new currency notes from ATMs. In other words, customers do not get soiled notes from ATMs.

7.   ATM provides privacy in banking transactions: Most of all, ATMs provide privacy in banking transactions of the customer.

Any Branch Banking

 Any Branch Banking System (ABBS) provide customers with a flexible service for banking from any branches located anywhere in the country. The branch where the customer maintains his account is the base branch and the branch from where he carries out his transactions is referred as the remote branches. All the branches of bank providing any branch banking facility are inter-connected and are capable of providing online, real-time transactions to its customers. FACILITIES available under ABB:

•        Cash Withdrawal: You can withdraw cash from your account from any of our Core connected branches by presenting a self-drawn cheque. This facility is not extended for withdrawals by any third party.

•             The Bank's customer having ATM card can withdraw the Cash from any ATM of the Bank.

•             Cash Deposit: Deposit cash for credit of your account through any of our core connected branches.

•             Fund Transfers: Instantly transfer funds between your accounts or between your account and any third

party account maintained at different core connected branches.

•        Purchase of Demand Drafts / Pay Orders: Purchase demand drafts / pay orders at any remote branch by debiting your account maintained at the base branch.

•        Deposit of Local Cheques: You can deposit local cheques at remote branches for crediting the proceeds after realization to your account maintained at base branches.

•        Stop Payment facility at Remote Branches: You can give instructions to Stop Payment of cheques issued by you at any of our branches by simply giving a written request. You can also revoke the stop payment instruction issued by you earlier

•             Repayment to Loan accounts: Now you can make repayments to your loans such as Home Loan, Vehicle

Loan, etc. held with your branch through any of the Corp Bank Branches by Cash / Local cheque.

Eligible Customers

•        All adult individual customers and proprietary concerns having an SB, Current account, Borrower accounts such as Cash Credit, Overdraft a/c etc.

•        All business concerns like Partnerships, Corporate Bodies, Trusts, Clubs, Associations, Institutions, Organizations, Government, Administrators and executors.

•             Joint Accounts

•             Power of Attorney, Mandate holders

 

Application Package/Software

Application Package/Software is a set of programs to carry out operations for a specific application. For example, payroll

is an application software for an organization to produce pay slips as an output. Application software is useful for word processing, billing system, accounting, producing statistical report, analysis of numerous data in research, weather forecasting, etc. In later modules you will learn about MS WORD, Lotus 1-2-3 and dBASE III Plus. All these are application software.

Another  example  of  application  Package/Software  is  programming  language.  Among  the  programming  languages

COBOL (Common Business Oriented Language) is more suitable for business application whereas FORTRAN (Formula

Translation) is useful for scientific application. We will discuss about languages in next section.