TITLE - MANAGEMENT INFORMATION SYSTEM IN BANKING INDUSTRY

TITLE - MANAGEMENT INFORMATION SYSTEM IN BANKING INDUSTRY

Chapter 01

1.1 Introduction

A management information system is a system or a process that provides the information   necessary to manage an organization effectively. MIS and the information it generates are generally considered essential components of prudent and reasonable business decisions.

The back-office MIS is the backbone of any Information System solution and yet it has not received much attention. Organization whether large or small, need to have a strong back-office MIS before attempting to deploy any advanced front-end applications or delivery channels. These would be worthless without having a strong and flexible back-office MIS in place.

1.2 Banking in India originated in the last decades of the 18th century. The first banks were The General Bank of India, which started in 1786, and Bank of Hindustan, which started in 1770; both are now defunct. The oldest bank in existence in India is the State Bank of India, which originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank of Bengal. This was one of the three presidency banks, the other two being the Bank of Bombay and the Bank of Madras, all three of which were established under charters from the British East India Company. For many years the Presidency banks acted as quasi-central banks, as did their successors. The three banks merged in 1921 to form the Imperial Bank of India, which, upon India's independence, became the State Bank of India in 1955.

1.3 Application of MIS in Banking

A bank acts as a place, where the financial services are offered, which may include provision for the retail banking, investment banking, personnel banking etc.

The Management Information Systems should lay a great stress on the collection of the data from the various sources, in order to analyze and conclude the future business strategy. With the help of such information, banker is able to move out to talk to the customer and as a result of this; he is also able to get some type of business for the bank. So it can be said that it is very important to have an in depth knowledge about the trend in the business industry.

Merchants in Calcutta established the Union Bank in 1839, but it failed in 1848 as a consequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 and still functioning today, is the oldest Joint Stock bank in India.(Joint Stock Bank: A company that issues stock and requires shareholders to be held liable for the company's debt) It was not the first though. That honor belongs to the Bank of Upper India, which was established in 1863, and which survived until 1913, when it failed, with some of its assets and liabilities being transferred to the Alliance Bank of Simla.

Foreign banks too started to app, particularly in Calcutta, in the 1860s. The Comptoir d'Escompte de Paris opened a branch in Calcutta in 1860, and another in Bombay in 1862; branches in Madras and Pondicherry, then a French colony, followed. HSBC established itself in Bengal in 1869. Calcutta was the most active trading port in India, mainly due to the trade of the British Empire, and so became a banking center.

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