It Financial Services

1. Introduction

One feature of financial services sector in recent years is that information technology's wildly and deeply rooted in the sector. They are become more and more intimate to each other, especially, as the globalization move on in the world, information technology brings convenient and efficiency net-working to financial services sector, however, information security is what financial organizations concerned, false information, computer virus, hackers, could bring massive loss to financial organizations and their customers, in which case organization will lose those customer. In this essay, first of all, the development of information technology in recent years will be addressed. Then, the advantages and disadvantages of IT financial services will be draw. After it how financial services sector have deal with the disadvantages and security problem shall be analyzed. Nevertheless, a discussion of IT financial services security will write. In the last is the conclusion.

2. The development of information technology

2.1 the development of information technology

There are five stages of information technology revolutions in human history as far. The first stage of was the invention of language, about 40,000 years ago, which also is the basic tool to allow human being communicate their thoughts to each other, second stage was the writing of language about in the year 3500 AD, which enable the keeping of valuable information and spread among others. Third stage was the invention and use of printing, in the year 1451 European star to use this technology, that makes books and newspapers, became the most important media of spread information in the world. Television, broadcast, and telephone appoint information technology has step in the age of hertzian waves in the nineteen century, which is the fourth stage. The latest stage is the invention of computer and the internet. One machine could make you communicate to the whole world and have the information you want.

2.2 the birth of internet

In the year 1969, the advanced research projects agency net work was established in the defense department of United States, which idea was to link the pentagon, defense contractors, and Research University in a computer network that could be burned in war by a single bomb. After the cold world, the system is become more and more participation in the daily use by everyone except from military officers, defense contractors, as we call it internet. In which case of course, the internet had grown extremely fast during the two decades even during the time it was not open to the public. Since the wildly use of internet by each individual are more and more frequently, people cannot imagine what would be the life without internet, especially the generation born after the invention of the internet, even if there are disadvantages of internet, such as virus, hackers, fault of machinery. However, information technology will keep continue to move on, and all the industry will more or less influenced by it, financial services organizations as one of the industry cannot escape from it, what financial services sector should do is to adapt it, however IT financial services, is more efficient, and more convenient for the customers and financial organizations.

3. The advantages and disadvantages of IT financial services

3.1 the advantages of IT financial services compare to traditional financial services

First of all IT financial services needs a internet platform to support its services, under the powerful support of information technology, the physic place that used to support financial organizations' net-working will not be necessary any more, even it can turns to financial shoulder, decrease their competitive ability in the sector. Bulky physic places will be replaced by the address on the internet. Huge operation costs will decrease; internet platform and information platform also will replace large number of primary- level worker, and middle level worker, especially, the salesman number, large labor cost will be eliminate by information technology platform. For example, the operation costs of internet banking only take place about 15-20% of the income the bank earn, but tradition banking operation costs is about 60% of the bank's income. Nevertheless, internet platform make financial services working very much more efficiently and convenient to purchase by consumers. As mentioned below the traditional way to earn scale economy by financial services organization is to extend their physic net-working place, but the way for IT financial services sector to achieve scale economy is to increase the investment the resources of hardware and software, through offer customer high quality services and communicate with consumer more frequently through the internet, this could be possible in 24 hours a day, in order to seize new customers, to achieve their marketing competitive position. One feature of IT financial services is that their scale economy began to form, the marginal cost is more lower, as the times of services increase the operation costs is more lower.

3.2 the disadvantages of IT financial services

at some point, the rise of IT financial services make the financial services sector became more wick, the risk that IT financial services brings to the financial organization could be divided into two catalogs, which are the technical risk of information technology risk, and the risk of the features of IT financial services itself. First of all, let's look at the point of technical risk, the development of IT financial services make the financial services sector's security bound to