Advancement in technology has resulted in the rise of multiple channels of banking. Internet banking has evolved as an effective delivery channel. The article throws light on the risks involved in banking on the net and the issues of concerns for the regulators.

Technological advancements have brought about various changes in the way in which various products and services are delivered to the customers by the banks. Banks have been at the forefront in harnessing technology. Technology has resulted in the computerization of the bank branches and has given rise to electronic banking channels like Automated Teller Machines (ATMs), Internet banking, mobile banking and phone banking. Of these, Internet banking, relatively a new feature in the banking sector, has witnessed a phenomenal growth in the recent years.

It has emerged as a novel way of providing financial services to the customers. Customers are now feeling comfortable and at the same time convenient while banking through the Internet. Internet banking is the result of Internet, which is used as a medium to offer various financial services. The banking sector has recognized the potential of the Internet as a medium to offer various banking products and services.

Internet banking has gained popularity among various banks and their customers because it is cost-effective, promotes anytime-anywhere banking, facilitates the expansion of customer-base through increased geographical reach and helps to serve millions of customers at the same time.

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