Difference Between Core Banking and Internet Banking (With Table)

Almost everyone has a bank account nowadays. A bank is an institution that deals with the financial assets of the common people.

Banking, in the most basic sense, deals with the usual money deposition by the people and then lending this money to business ventures. The profit garnered from these business ventures is returned as an interest to the depositor.

People generally get perplexed when the matter of difference between core banking and internet banking emerges. Albeit, many consider both the same – there lies a subtle difference.

Core Banking vs Internet Banking

The difference between core banking and internet banking is that core banking offers a wide range of services to both customers and bank officials, whereas internet banking is limited to customer services only.

Core Banking is the rudimentary system that provides a score of services – not only helpful for the depositor but bank officials as well.

Internet banking, on the other hand, works as an ancillary and is merely a minor instance of core banking.


Comparison Table Between Core Banking and Internet Banking (in Tabular Form)

Parameter of ComparisonCore BankingInternet Banking
DefinitionCore banking is the banking construct where the depositor and account information is centralized to the bank server instead of being stored at a single branch.Internet banking is the banking interface which allows a customer to make or receive payments online using their portable mobile or computer devices.
Storage of InformationCore banking systems employ large centralized servers that store account-related information from all the branches of that particular bank in a single memory location.Internet banking system generally employs an online banking software that requests information access from the main bank server and stores it in the user application for instant perusal.
Services OfferedCore banking renders many basic as well as advanced services such as transactions, servicing loans, establishing interest rates, and handling mortgages and payments.Internet banking is mostly deployed for personal services such as viewing account balance, transferring money between accounts, and making small payments.
Customer Relationship ManagementCustomer relations are at a nascent stage in the core banking system. It strives to resuscitate customer grievances using net banking.Internet banking provides greater customer interaction through personalized apps and grievance redressal becomes swift.
Security ConcernsCore banking has security issues if data storage is on-premise. This is mainly due to a lack of confidentiality.Internet banking poses a great threat if the linking application is not secure, such as weak passwords.


What is Core Banking?

Core banking refers to a streamlined banking process wherein deposit, transaction, and another bank-related activity can be carried out from any branch of a particular bank. This comes irrespective of the branch where the account was first created.

CORE stands for Centralized Online Real-Time Environment banking. It tends to be more suitable for bank officials by reducing the front end workforce as the majority of the tasks are automated.

The major advantages offered by core banking are – swift customer service, automation of accounting tasks,  diversifying the scope of operations, and bringing down operational charges. The services offered by core banking include – transactions, loans, financial moratoriums, and a lot more.


What is Internet Banking?

Internet banking also called Web banking or Online banking, is a banking system where instead of being physically present in a bank, transactions can be done via online banking software.

This reduces the need to travel up to the nearest branch of the bank even for a small account statement. Also, bank accounts in different banks can be accessed from the same online payment software application.

The major advantages offered by internet banking are – instant grievance redressal, no physical presence required, faster operation

, no geographical restrictions, and foremost – high data security.

The services offered by internet banking are – viewing account balance, transferring money between accounts, recharging phones, and paying bills.

Main Differences Between Core Banking and Internet Banking

  1. Core banking is the basic banking approach whereas internet banking is a part of it.
  2. Core banking uses centralized servers to store customer’s information while internet banking uses application software to request a copy of the account information from the bank server.
  3. Core banking allows a customer to retrieve services from one of the many branches of a particular bank only. On the other hand, internet banking allows greater flexibility by providing access to many different banks through a single application.
  4. Core banking has a nascent approach towards Customer Relations Maintenance while Internet banking employs the same from the easily personalized net banking software.
  5. Core banking is considered to be more reliable than internet banking while internet banking is considered very safe unless there is a ransomware attack!



Core banking is an old tradition being revamped while internet banking is a new consideration for core banking sectors and alliances to invest into.

In core banking, the responsibility of the account holder’s data lies in the bank officials and technologies ( like cloud services)  employed by them.

In internet banking, the customer has higher accountability in maintaining strong passwords and secure methods so that the account information is safe.

Many big business ventures have launched money transfer applications in a bid to “Go Digital “. This has empowered the core banking and allowed easy transactions and money transfers. Internet banking couldn’t have been possible lest core banking had not centralized their operations. Both are meant to be concerted so that ultimately the customer is the one most benefitted.



  1. https://dl.acm.org/doi/fullHtml/10.1145/1330311.1330322
  2. https://www.emerald.com/insight/content/doi/10.1108/10662240010312048/full/html
  3. https://ageconsearch.umn.edu/record/19246/files/sp05ka03.pdf
  4. https://www.sciencedirect.com/science/article/pii/S1877050910005703
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