Post nationalization of banks, the banking activities have increased by leaps and bounds. To serve their customers efficiently, banks are increasingly adopting the technology. ATMs, Internet banking, mobile banking, phone banking are some of the examples. To remain competitive banks are adopting core banking system, which provides interlinkage between branches. While formulating a technology policy, banks are taking into account the vision of five to ten years and technology which is compatible to Basel II norms.

The phenomenal transition from class banking to mass banking after nationalization posed an enormous challenge in respect of servicing the explosive increase in customers in Public Sector Banks (PSBs). Prior to nationalization bank branches were limited to metros and towns, customers were fewer and services offered were limited. Post nationalization, public sector bank branches sprang up in every nook and corner of the country. People from all classes became bank customers and the volume of daily transactions increased by leaps and bounds.

As could be expected under these circumstances, the standard of customer service in banks began to decline. To meet the needs of the rapidly swelling customers and their growing expectations, technological solutions were the obvious answer. But it did not happen overnight. The resistance of the bank unions, which feared retrenchment and job loss, had to be overcome and the bank staff had to be convinced about the long-term benefits of introducing technology in banking. Eventually, technological solutions entered Indian banking in the mid-1980s following the road map prepared by the two Rangarajan committees for computerization of banking operations, particularly in the public sector banks.

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