KARACHI, May 28: Deputy Governor, State Bank of Pakistan, Yaseen Anwar, said on Saturday that information technology has transformed local banking sector and has redefined the concept of banking and financial services, but the banking system is still far from the desired level of development.

Delivering his keynote address at the 'IT and Banking Conference 2011', jointly organised by the SBP and Pakistan Software Export Board, he said the need for a customer to visit a branch where his or her account is parked is now no more an obligation.

He said branchless banking had the potential of changing lives of those who are still un-banked and without any financial service.

He, however, emphasised that the minimum security standards must be adopted to ensure safety and maintenance of e-banking transaction. The banks must design foolproof data security processes, he said.

Numerous banking services through the technology platform have not only enhanced business volumes of banks and increased access to un-banked geographical regions, it has also brought about operational and cost efficiencies, he said.

More recently, the information technology has brought about another revolutionary change in how banking will be conducted in the future. By bringing about the possibility of branchless banking the whole concept of brick and mortar branch is changing, he added.

Mr Anwar said in Pakistan banks have vast space to work in this area as 85 per cent of the population still remains un-banked and untapped.

“Many banks are moving towards more sophisticated IT-based solutions to run their businesses efficiently and facilitate financial services for customers,” he said, and added that some banks have implemented core banking solutions, which marked a paradigm shift as bank customers can now access their accounts from any of their branches.

He said the information technology advancement had helped banks manage the complex capital adequacy framework and they are now better placed to measure, monitor, and control credit market as well as operational risks.

“More and more banks are moving towards an integ-rated platform for manag- ing various transactions, including foreign exchange, money market, fixed income, and derivates,” he added.

Mr Anwar observed that though banks in Pakistan had come a long way in implementing the infor-mation technology, the banking system is still quite far from the desired level both in terms of quality and quantity of IT-based solutions provided to their customers.

He said although some foreign and large local banks had made significant progress in establishing superior e-banking platforms, the effect was largely limited on overall basis due to restricted outreach of these institutions.