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    Avatar Posted by sona240 275 days ago (http://www.business24-7.ae)
    Category: Business | Tags: internet e-banking communication busines


    The use of the internet in the distribution of financial services, particularly in e-banking and e-payments, is the decade’s most important innovation in information and communication technologies (ICTs), according to a recent report from the United Nations.

    The Information Economy Report 2007-2008 states that over the past 10 years the use of ICTs have been detrimental in “driving major innovations in business processes, and financial intermediation”.

    It also says ICTs have further enhanced globalisation, liberalisation and technological change and cites ICTs as a major force in the future.

    In the past decade the share of payments by paper-based cheques and credit transfer orders have decreased from 60 per cent in 1989 to 20 per cent in 2005. E-banking has also decreased the tendency of economic agents to keep cash and increased the importance of commercial bank money. The value of deposits kept by non-banks in commercial banks in G10 countries increased from 30 to 50 per cent of GDP, while the share of currency remained stable at seven per cent.

    E-banking – referred to as internet or online banking – has proved to be less costly for the commercial banks and convenient for businesses, governments and individuals.

    Transaction costs are much lower and consumers can keep control of their finances at the touch of a button.

    The significance of online transactions can be mainly traced in remittances which are increasingly relying on online money transfer systems. And in a country like the UAE where outward remittances by expatriate workers continue to weigh heavily on its balance of payments, this is a major issue.

    Remittances by expatriates in the UAE are slated to have reached Dh59 billion, about 17 per cent of the country’s gross domestic product, figures from Abu Dhabi Chamber of Commerce and Industry show.

    Worldwide, remittances sent by migrants to developing countries reached $206bn in 2006, but it is estimated that the real level of current remittances could be 50 per cent higher owing to the major role of various informal remittances networks.

    In other words, the overall volume of all remittances might come close to that of the foreign direct investment (FDI).
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