MM Bank is a multinational bank that provides internet banking to its customers. It has over 400 bank branches.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2024). The mark or mark type is shown in brackets.

1. [2] Operates in more than one country
2. [2] Has head office in one/mother country/in more than one country
3. [2] Usually public limited companies
4. [2] Has many employees internationally
5. [2] Savings/deposit
6. [2] Current/cheque/checking
7. [2] Basic bank account
8. [2] Fixed deposit
9. [2] Digital account
10. [3] Yes - provides a permanent record/proof (1) for future reference/can refer to (1) enables detailed information to be sent (1) e.g. how the app works (1) can be supplemented by visual/numerical information (1) less chance of misunderstanding between bank and customer / better explanation of the change (1) be prepared to use it (1) can send the same letter to all customers (1) over long distances / international customers (1) lacks personal approach (1) enables customers without mobile devices to receive the information (1)
11. [3] No - slow to receive/to distribute (1) can take 3-4 days (1) risk of letter not being received/lost/damaged (1) some customers do not have postal addresses (1) expensive/costly (1) paper/printing/transport costs (1) to post to all customers (1) response not usually possible (1) it may not be read in full by the customer / some customers would not be interested / ignore letter (1) illiterate customers (1) or understood by the reader / on complex points in letter (1) may be seen as junk mail (1) quicker/cheaper/easier to use email (1) as it provides internet banking service (1) could forward one email to all customers/sent in one send (1)
12. [6] Positive effects on banks: Fewer staff needed to serve customers in banks as teller transactions have declined. This reduces labour costs and saves on wages, possibly increasing profits
13. [6] Less bank branches needed as more people use internet banking This reduces costs of premises and other running costs
14. [6] Improved customer service as some customers, prefer the benefit of instant access to their bank accounts and the ability to carry out transactions 24/7 wherever they are
15. [6] Can widen customer base/customers prefer it as it easier/faster to use / with more people applying for loans / better interest rates
16. [6] If a bank's website is user-friendly, it can attract customers from other banks making the banking industry more competitive.
17. [6] Negative effects on banks: Less customer satisfaction as some customers not ready or do not want to use internet banking
18. [6] Less personal service/relationship with customers as customers are expected to use ATMs and their smartphones to access banking so banks are less knowledgeable about their customer needs
19. [6] Internet banking has led to increasing technology costs for banks to have robust systems against security breaches
20. [6] Internet bank accounts usually have higher interest rates, so this cost banks more interest
21. [6] Most banks offer better savings rates for internet-based accounts so banks profit margins may be lower
22. [6] Some customers have lost money through criminal activity on their internet-based accounts causing negative publicity for a bank.
23. [6] Evaluation: Overall, there are many benefits to banks who offer internet banking services but there is still resistance from some customers who prefer to talk to bank staff and who do not have reliable internet connections. This means the banks could lose those customers to other banks so their revenue would decrease. At present, both bank branches and internet banking are still needed for the wide range of banking customers.