This project examines the general impact of Information Technology(IT) on the banking industry. The banking industry has introduced various new customer services and products using IT. The banking industry has gone through many changes as a result of the introduction of IT. In fact, the structure of the industry is continuously changing because of rapid development of IT. The continued success of IT applications mean that the limitations of current IT computer systems in banks have to be re-developed to meet future requirements.

The aim of this project is to evaluate how the banking industry has applied IT; the effects of IT on competition; current IT applications and systems problems; the security of IT systems; IT risk and IT fraud and the future application of IT in the banking industry. The focus of the report has mainly been in the UK and US.

In the research, the banking industry has demonstrated a fair amount of competence in the application of IT. Some banks were at the cutting edge of IT and have a clear vision of how IT could be furthered applied successfully. Banks have spent millions of pounds on IT every year in a bid to fully automate its operations and services to customers. The industry recognises that IT was a major key to its development.

The research brought to light the fact that IT has increased competition within the industry. The realisation that the market size is not really increasing has made banks more competitive. Also, the expectation of their customers is very high and in response banks using IT to satisfy the demand for quality services and products. However, there is an increasing outside threat to the banking industry from the non-banking sector. Deregulation of the banking industry has introduced more competition but the low cost of computer technology has made it easier to enter the industry. Non-banks can now pick up off