Security Issues in Banking Sector in Sri Lanka

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INTERIM REPORT

This interim report is for the project title “Security Issues in Banking Sector in Sri Lanka” and this report would be based on providing the overview of the project aims and objectives and research question. The initial literature review would also be provided which would be developed on the basis of aims and objectives. Bank is considered as financial an institution which provides the financial as well as banking services to the customers. It is also considered as providing fundamental banking services which are related to providing loans and accepting deposits. Banks are also associated with system which provides cash management services for customers and reports their transactions and account portfolios. There are also certain non banking institutions which are involved in providing bank services ignoring the legal practices applied. Banks are considered as the subsets of financial industries and offer cash management services to the customers (Andoh et al, 2010, p. 36). Banking services in Sri Lanka should be able to meet the challenges posed by technology and other factors such as internal and external. In Sri Lanka, banks are considered as the main part of financial services taking place. There have been many outstanding achievements in the banking sectors to its credit. Banking system provides many opportunities and facilities to the customers. Banks provide credit, loans, payment services, checking accounts, cashier's cheques and money orders. Banks offer insurance and investment products. There have been majority of integration and cooperation among finance industries. There have been many changes taken place in regards the insurance companies, banks, security firms and traditional districts have diminished.

Research Question

The main research question for the study is:

What are the security issues which are faced by banking sector in Sri Lanka?

Aims and objectives

The aim of the study is to determine the security issues in banking sector in Sri Lanka. The objectives of the study are as follows:

To determine the types of security issues such as sms banking security issues, online banking security issues, mobile banking security issues etc.

To determine the solution provided for resolving the security issues faced by banking sector

Initial Literature Review

In Sri Lanka, online banking system was first introduced by Sampath Bank in 1998. This helped the customers to access their accounts at any branch and this was all possible through networking. ATM cards helped the customers to withdraw money from machines. This made a revolution in the Sri Lankan banking industry. The main challenge which was faced by the customers through this type of banking was satisfaction of customer on security provided. The below mentioned studies will define the clear review about the past studies conducted in this regard.

According to study Deshpande (2002) identifies that security risk, operational risk, legal risk, reputational risk and Cross Border risk are the risks which should be paid attention by the regulators. According to the research by the Bank of America 12% customers are not satisfied by the service provided. Furthermore, customers belonging to the age group 35-54 are satisfied ...