Swiecka Beata, Szczecin University Management and Economics Services Faculty Comparative Economy Department
Factors of Development Retail Electronic Banking
The article is devoted to investigation of development retail electronic banking in Poland, its factors, strong points, weak points, opportunities and threats.
Статтю присвячено дослідженню розвитку роздрібних електронних банківських операцій у Польщі. Розглянуто фактори його розвитку, сильні та слабкі сторони сектора роздрібних електронних банківських операцій.1. Banking system development in Poland Every country has its own system of banks. Their variety, structure as well as range and the modus operandi give the specific character to the banking systems of individual states. Before the Second World War, banking system in Poland was relatively well developed. In 1938 alongside the modern Polish Bank, fulfilling the central bank function as well as the role of bank of banks enjoying great prestige both at home and abroad, the great State-owned banks operated (Bank Gospodar- stwa Krajowego, National Household Bank, Panstwowy Bank Rolny - State-Owned Polish Agricultural Bank as well as Pocztowa Kasa Oszcz^d- nosci - Post Savings Fund Society), 27 private banks in form of joint stock companies (including four foreign ones), 28 bank houses, 19 credit companies, 333 municipal savings banks, 975 municipal loan and savings fund societies as well as 5597 loan co-operative societies. Immediately after the end of the war the liquidation of private banks begun and adaptation of banking structure to new constitutional order started in order to adjust it to new socio -economical and political conditions. Many banks were dissolved, others merged, competition between banks was eliminated. The bank machinery became fully subordinated to the Ministry of Finance. The Narodowy Bank Polski [7he National Bank of Poland] being the national central issue institution and commercial bank at the same time was brought into being in 1945. As the time run, The National Bank of Poland absorbed every new bank and this process continued till mid-70's. At the beginning of the eighties there were three more nationwide banks except for NBP: The Bank Hand- lowy [Commercial Bank] - dealing with international trade of Poland, The Bank Polska Kasa Opieki S.A. - operating the people's foreign exchange operations and accepting the a vista savings deposits and time deposits in foreign currencies and the Bank Gospodarki Zywnosciowej [Agricultural / Food-Processing Bank]- specialized in the agriculture credits and being an organizational headquarter that includes 1550 co-operative small- and very small-sized banks in its structure. They were then only formally independent banks, actually they were branches of the NBP's or rather of the Ministry of Finance (to which also the NBP was subordinate for many years- and the President of the National Bank of Poland was the Under-Secretary of Finances).
A kind of breakthrough took place as a result of the economic reform in 1982 resulting in appearance of the Banking Law and the Act of Law on the Statutes of the Narodowy Bank Polski [National Bank of Poland]. This Act was the one that contributed to the Narodowy Banku Polski [National Bank of Poland] becoming independent of the Ministry of Finance, and to broadening the role of the central bank in shaping the monetary- credit policy as well as to enabling banks being established in form of joint-stock companies including those with foreign capital share. As a result there were three new banks brought into existence since 1982 till 1989. But NBP was still executing its typical monobank functions through its branches, and the state- owned enterprises were linked with the central bank divisions, thus no grounds for competition in bank
and economic entities relations field were created.
1989 year is considered to be the breakthrough in the Polish banking system; this year entailed both structural and ownership changes. As a result of introducing the Banking Law and the Act of Lawon the Narodowy Bank Polski [National Polish Bank] of 1989 the Polish banking structure evolving in previous years was becoming adjusted to the market economy rules and mechanisms.
Passing of new banking law that took place in 1989 enabled adaptation of banking system to market requirements and needs. Owing to the new legislation the grounds necessary for creation of two- stage banking system were established. The Naro- dowy Bank Polski [National Polish Bank] spearheaded the Polish bankig sytem as the superior bank of the State. The NBP has been fulfilling functions of: bank of issue, bank of banks as well as bank of the state and national economy. The result of introducing new banking law as well as aiming at two- staged banking system was separation of nine state- owned banks from the NBP, which were transformed into sole-person companies of the State Treasury, acting as independent, self-financing enterprises dealing with gathering of financial resources, granting of credits as well as financial accounting. Owing to the 1989 Banking Law introduction economic units, natural and legal persons got the full liberty of the bank selection. Institutional conditions to enable competition between banks as well as great possibilities of founding banks in form of joint stock companies, for natural persons, both from the country and from abroad were created.
2. The IT use in retail banking sector in Poland
Last decade have caused rather essential changes in bank sectors which was to a large degree the effect of Information Technology (IT) development. The present arrangement of the bank market in Poland has been to a large degree shaped for last a dozen or so years, during which the bank sector has been restructured, privatised and supplied with additional capital, yet the major changes have been happening as a result of IT implementation and spreading. The predominant countries of Europe in respect of economy as well as the United States are leaders in creating new services, bank products, and the principles of working they established often become de facto standards of solutions in other banking systems. The Polish banking system, similarly as the world one, is subject to similar mechanisms, including globalisation, consolidation and electronisation of activity of financial markets. The effect of this is growing competition in both corporate and retail banking. The growth of competitiveness of banks conducting operations in Poland will depend to a large degree on the IT development .
Retail - banking is the most dynamically developing segment of bank sector in Poland, with private customers being its area of interests. Group of these customers is very diversified as regards wealth, age, expectations, preferences etc. After transformation in 1989 r. the bank retail - customer was underestimated. Services for this sector were rendered mainly by Bank Powszechna Kasa Oszcz^dnosci Bank Panstwowy [The Public Savings Fund Society Polish Bank], whereas remaining banks delivered services reluctantly and to a negligible degree. As the time went by the banks began perceiving a private customer as profit-yielding one. Investigations in retail financial services sector show that 20% of the best customers generate 100% profit whereas the rest bring losses. The retail - banking has to face the challenge to propose to the rest of clients such services and in such a form that will allow to obtain the income. It seems thus necessary to allocate more means for increasing expenditures for information technologies (IT) at banks that will allow them to reach potential customers, offer the wide assortment of products and to supply them in an inexpensive way, most convenient for the customer .
The retail - banking development in Poland until now, delivered so far by means of electronic media has been the result of close relationship between offering services via internet and growth of the number of bank customers. Although the phenomenon of electronic banking system is very wide as it includes both internet, telephone and terminalbanking it is, however, the internet banking that is of major importance in its development. In the end of 2003 about 1.5 million of individual persons in Poland took advantage of internet banking system (about 23% users of Internet). They opened 2.6 million internet accounts, which is 24% of all savings- giro accounts, and the volume of internet banking transactions reached PLN 6.3 billion per month in 2003. Although the phenomenon of internet banking has existed on the Polish market for only a few years nevertheless it is becoming more and more important , which can be proved by continuously growing number of clients. The number of private (individual) customers of internet banking system in Poland grew up by 217% in 2002 year on the average. It is the mBank that recorded the greatest number of private customers at the end of year 2002 - achieving result over 329 thousand customers. Some of the analysed internet banks reached over 200% increase of the private customers number using private internet accounts. It is manifestation of the favourable perception of internet banks.
According to prognoses of the Instytut Badan nad Gospodark^. Rynkow^. [Institute for Market Economics] in bank sector in Poland there should be opened over 3.3 million internet accounts in 2006. Coming up to this prognosis would signify the achievement of ratio of number of accounts in internet to the number of