Internet Banking Risks And Control Issues

With the development of information technology,Electronic commerce,the fierce competition between banks and banks' desire for low cost and high profit ,a new kind of bank ——internet bank appeared in the world. It uses Internet and Internet technology to supplies convenient and prompt financial services for people and has different characters from traditional banks, such as operating beyond time and space, renovation quickly, operating tools different from traditional banks. Internet bank has great influence on traditional banks. So it is the trend of the world to develop Internet bank. However, whether or not Internet bank will develop smoothly, it depends on how to control its risks. So I select this topic as my thesis.Internet bank has the same risks as traditional banks such as safe risks, operating risks, credit risks, law risks and other risks. But, the risks described above have different effects on traditional banks and Internet banks. Some risks are very prominent because of the characters of Internet banks. So we should study and find the measures of controlling the risks. First, Internet bank itself should enhances risks measuring and risk prevention. Then, Financial Supervision Authority should make use of the experiences of other countries for reference. At the same time, it should strengthen supervision in market entrance permission, daily supervision, market exit system and cooperation with other countries. At last, a good society environment is needed to develop Internet bank. So we must control the risks from three aspects: the Internet bank itself, Financial Supervision Authority and the society environment.This thesis mainly discusses risks of internet bank and the measures to control the risks. There are total three parts in the thesis.In the first part, it focuses on resolving the problem of how to understand internet bank including the definition, appearance, development direction and the states of internet bank in our country.In the second part, the thesis analyses the risks faced by internet bank including safe risks, operating risks, credit risks, law risks and other risks. At the same time, it states the characters of the risks.In the third part, it tries to give some useful advises on how to control the risks which includes three parts: internet bank control its risks inside, Financial Supervision Authority supervises outside and the society environment is improved.Besides, the thesis discusses not only the problem of internet bank in the West but also the states of Internet bank in our country. Although the appearance of internet banks in our country is late, it develops quickly. Foreign banks will compete with Chinese banks by use of internet bank because they are shortage of business branches. So studying the risks of internet bank and finding the measures to control the risks are very significant to develop the Internet bank in China and in the world.