CHAPTER TWO: REVIEW OF RELATED LITERATURE ( MY PROJECT )

MY SCHOOL PROJECT

CHAPTER TWO

REVIEW OF RELATED LITERATURE

1. Historical Development of Computer
2. History of Computers
3. Concept of Computer
4. Framework of Computer System
5. The Nature of Computerization in the Nigerian Banking System
6. The Role of Technology in the Computerization and Development of Banks in Nigeria
7. The Computerization of the Banking Operation in Nigeria
8. Challenges of Computerization of Banking Operation in Nigeria
9. Theoretical Framework

1. Historical Development of Computers

 

           Computer was first recorded as being used in 1613 and was originally used to described a person who performed calculations. In 1822 Charles Babbage proposed and began developing the different engine, considered to be the first automatic computing engine that was capable of computing several set of numbers and making copies of the result. While Thomas of Colmar was developing the desktop calculator, a series of very interesting developments in cumputers was started in Cambridge, England, by Charles Babbage ( left, of the which the computer store "Babbages, now Gamestop, is named ), a mathematics professor, in 1812, Babbge realized that many long calculations, especially those needed to make mathematical tables, were really a series of predictable actions that were constantly repeated. It was intended to be steam powered and fully automatic, including the printing of the resulting tables, and commanded by a fixed instruction program.

  

            The difference engine, although having limited adaptability and applicability, was really a great advance, Babbage continued to work on it for the next 10 years. But in 1833 he lost interest because he thought he he'd a better idea  the construction of what would now be called a general purpose, fully program-controlled, automatic mechanical digital computer, Babbage called this idea and Analytical Engine. The idea of this design showed a lot of foresight, although this couldn't be appreciated until a full century later. The plans for this engine required an identical decimal Computer Operating on numbers of 50 decimal digits ( or words ) and having a storage capacity ( memory ) of 1,000 such digits. The built-in Operations were supposed to include everything that a modem general purpose computer would need, even the all-important conditional control transfer capability that would allow command to be executed in any order, not just the order in which they were programmed. The analytical engine was soon to use punched cards ( similar to those used in a Jacquard loom ), which would be read into the machine from several different reading stations.

          The machine was supposed to operate automatically, by steam power, and require only one person there. Babbage's computer were never finished, various reasons are used for his failure. Most used is the lack of precision machining techniques at the time. Another speculation is that Babbage was working on a solution of a problem that few people in 1840 really needed to solve after Babbage, there was a temporary loss of interest in automatic digital computers. Between 1850 and 1900 great advance were made in mathematical physics, and it came to be known that most observable dynamic phenomena can be identified by differential equations ( which meant that most event occurring in nature can be measured or described in one equation or another ), so that easy means for their calculation would be helpful.

         Moreover, from a practical view, the availability of steam power caused manufacturing ( boilers ), transportation ( steam engine and boats ), and commerce to prosper and let to a period of a lot of engineering achievements. 

2. History of Computers

           Historians start the history of calculations with the abacus, a wooden frame with balls or heads strung on parellel wires. but, principally first such machine having principles of today's computing machines, was developed by Charles Babbage in Nineteenth Century. It had certain basic ideas of stored computer programs in the machine. Such a machine was devised by Babbage in the year 1822 and was called difference engine. It was used to perform simple arithmetic computation needed for setting up of trigonometric and logarithmic tables. Further he developed and analytical engine around 1871 that was a prototype computer. Meanwhile an important theoretical development occured, around 1850, when George Boole, a mathematician developed and algebraic system which is now called as Ballian Algebra. This Ballian algebraic system is used to represent quantities as binary numbers i.e 0s and 1s and also represent and manipulate logical expressions.

                The significance of Boolian Algebra was not utilized at that time. In the nineteenth Century, around 1880, Hollerith developed techniques and machine that had significant impact on the future design of computer. He design a machine in which data was represented in the form of punched holes on paper cards. This machine could work with punched cards and handled 50-80 punched cards perminute. The punched cards contained 80 columns and rectangular punches. These machines were tabulators. The machines were also used for semiautomatic election and sorting of cards. He set up his own company "Computer Tabulating Recording Company"  which eventually became international Business Machine Corporation (IBM). Today, IBM is one of the largest companies in the computer world.

EARLY COMPUTERS: 

        Howard Alien (1937), designed a huge mechanical calculator called MARK I with a number of switches, mechanical relays and cards. The size was 15X 2.4 m X 0.6 m. This was the immediate predecessor of automatic electronic computers. ENIAC (Electronic Numerical Integrator and Calculator ) designed in 1946 was the first electronic calculator. It occupied a room of 15X 9m and its weight was 30 tons. It was water cooled and much faster than MARKXI. Around 1950, a computer named EDVAC (Electronic Discrete Automatic Computer ) was designed which was based on Neumann's idea. ( Frequently referred to as father of modern computer ) He was first to use stored programme concept in computer The storage capacity of EDVAC was 1024 works of 44 bits each. It aslo had an auxiliary storage of 20,000 words.

FIRST GENERATION OF CUMPUTERS (1946–55):

           The computers manufactured between 1945–55 are called first Generation Computers. They were extremely large in size with vacuum tubes in their circuitry which generated considerable heat. Hence, special air conditioning arrangements were required to dissipate this heat. They were extremely slow and their storage capacity was also very lass compared to today's computers. In these computers punched cards were used to enter data in to the computer. These were cards with rectangular holes punched in them using some punching decices. UNIVACI was the first commercially available computer, bult in 1951 by Remington Rand Company, it had storage capa of about 2000 words. These were used mostly for payroll, billing and some mathematical computing.

SECOND GENERATION COMPUTERS (1956–1965):

            The computers, in which vacuum tubes were replaced by transistors made from semiconductors, were called second generation computers. The use of transistors reduced the heat generated during the Operation. It also decreased the size and increased storage capacity. It required lass power to operate and we're much faster than first generation cumputere. Magnetic media was being used as an auxiliary storage of data. These computers used high level languages for writing computer programs FORTRAN and COBOL were languages used.

THIRD GENERATION COMPUTERS (1966–1976): 

               The third generation computers started in 1966 with incorporation of interested circuits (IC) in the circuitry. IC is a monolithic circuit comprising a circular equipment to tens of transistors on a single chip of semiconductors having a small area a number of pins for external circuit connections. IBM 360 series computer in this generation had provision for facilitating time sharing and multiprograms also. These were small size and effective computer compared to second generation Computers. Storage capacity and speed of these Computers was increased many folds as include user friendly package programs. word processing and remote terminals. Remote terminals could use central computer facilities and get the result, instantaneously.

FOURTH GENERATION COMPUTERS:

           Fourth Generation Computer were introduced after 1976 and in the these Computers electronic components were further miniaturized through Large Scale Integration ( LSI ) techniques Microprocessor with other LS1 Chips, with compact size, increased speed and increased storage capacity, in recent days, ICS fabricated using VLSI ( Very Large Scale Integration ) techniques are used in Computers. 

            Through this techniques, the storage capacity is increased many folds. Not only that, the speed of these computers is also very high as compared to earlier computers. During 1980s, some computers called as super computers were introduced in the market. These computers perform Operation with exceptional ly high speed ( approx 100 million Operations per sec ), This speed is attained by employing number of Microprocessors consequently their cost is also very high. There are normally used in very complex application like artificial intelligence etc.

FIFTH GENERATION

               The technological changes in the area of computer development later become so fast that it was now easier to absolutely keep of what was happening everywhere simultaneously. Nevertheless, it was still known that the fifth generation computer we're much more compact and with large scale integrated circuits which gave rise to hundreds of models of micro and mini Computers and later personal computers. They are about the latest in circuits and were introduced in 19885. Apart from the above classification of computer which was based mainly on age, computer can be generally classified in the following three ways 

• By purpose- speed or general computer
• By type- analogue or digital computer 
• By capacity- size

        Depending on their flexibility in operation computers are either of the general or spacial purpose type. A special purpose computer is the one that is designed to solve a restricted or particular class of problem such as computer may be even designed or built to do one job only. The general purpose of computer on the other hand, is designed to solve a wide variety of problems. Thus, the general purpose computer can be used such task as payroll, banking, scale analysis billing cost accounting and monetary control jobs ( French 1996 )

    

           Analogue computers are also named because they function by setting physical station that are analogue to mathematical solution. An analogue computer operates on data in the form of continuous varying physical qualities such as pressure temperatures, speed and voltage. Digital computer on the hand operate on other characters coded numerically. The digital computer has a memory and solves problems by counting precisely by adding, subtracting, multiplying, dividing and the ability of digital computer to handle alphabetical and numerical data precision and speed makes them ideally suitable from processing data.

         In addition to this, analogue and digital classification of computers. It should be noted that third type of computer is now being merketed. This is known as the hybrid Computer system ( Frnach 1996 ), Talking about the classification of computer based on capacity or size, it was said in the past that capacity was measured in terms of physical size in the early stages of electronic computers. Today, however, physical size is not a good yardstick to measure capacity. The is because is better expressed in terms of the volumes of work that a computer does not necessarily the physical size of the computer. Going further in the analysis, it is worth being said that computer can also be ranked into three categories as follows:-

1. Mainframe computer
2. Mini computer
3. Micro Computer

Computer is an electronic device for starting and processing data, typically in binary from according to instructions given to it in a variable programmes. A computer is a programmable machine designed to automatically carry out a sequence of arithmetic or logics. Computer is also device that accepts information in the form of digitalized data and manipulates it for some result base. Samuel infrastructure for generating collecting, storing, processing and transmitting data and information. In explaining the computer since information technology resolves round it.

         The following application of current technologies to information processing from computer telecommunication and microelectronics, the early development of computer can be said to have started before 20th century and has been improved upon over the centuries, it's therefore, categorized into generations several efforts had been made on the development of computers countries before the development of electronic computer. Among these are sample device called Abacus which consists of sets of beads of for addition and subtraction. Napier's Bones for multiplication, pascaline which was the first mechanical calculating machine for addition and subtraction, invented by Blaise Pascal in 1642, multiplier wheel for multiplication and division, development by Gottrrted W. Leibriz in 2007 ; and analytical engine developed by Charles Babbage in 1834. Further to the development of computer in 1937, it was discovered that addition machines and shade rules was performing more complex calculations. Then in 1939, John V atanasoffa, a professor of physics and Clifford E. Berry and graduate student of lower state collage, developed an electronic computer called Atanasoffa Berry computer ( A B C ). The computer used 2000 vacuum tubes to perform calculations capacitors to store to binary data and punched cards to communicate input / output. 

       Unlike the old mechanical adding machine that use direct counting, the ABC utilized logical operation to perform addition and subtraction. The evaluation computer is now categorized in to first, second third, fourth and fifth generations. The computers prodiced in each generation are unique for their purposes. Each generation of characterized by a major technological development that has change the way the computer operates resulting increasingly smaller cheaper, more powerful and more powerful and more efficient and reliable devices, French,  (2011).

3. Objectives of Computerization

                All the computer are connected to the main computerize transaction such as deposits or with withdrawals by customers are entered into the terminal by the cashier and then are processed by the main computer immediately. The computer terminals provide banks with a quick and efficient way of handling customer's accounts. Such terminal can automatically process deposit, withdrawals, interest, etc, the significance of automatic processing can be appreciated by both customers and bank employees. A customer can be given updated account of information a given period. Also through the terminal it can repidly be determined if a particular account contains sufficient funds prior to cashing a personal cheques, Kurfi, (2003).

    

                  Bank managers can also appreciate the automatic processing capabilities, such as mount of cash at hand current assets and liabilities and number of customer can be generated by the terminals this information can also be used to help plan and make decisions about whether to open or close a particular bank branch. Basically, the objectives of Computerization to the banking sector are to make banking operation easy, cheaper, more efficient and reliable to the customers. Many reasons were given by those introducing their systems.

           As a result of company's expansion there will be voluminous manual aspect of Operations; e.g. ledger cards, book keeping so as balancing the transactions at the end of the day, operations of the bank is time consuming and very tedious, and the bank books have to be balanced at the end of the day. The use of the computer makes this work simpler and less time consuming.

      

          Operational efficiency and increase in customer satisfaction. The computer hardly makes any mistake in balancing the books and as such leads to higher efficiency and effectiveness. Also due to its fastness, it allows the bank carry on with other activities boosting it's operations and at the same time serving the customers faster and more efficiently, which also enables the customers to go on with their other activities accordingly. The use of computer makes data transfer accurate and simple. It minimize chance of fraud wait will not be easy to make changes. When the work is done manually one can only pick up a pen and change some figured and lucky could get away with it, Kyari, (2009).

   

             More and more banks are using the computers with the appreciation of what the system can do the word computer used to be a 'threat to a lot of people and most felt it is system one cannot understand due to the awesomeness of its capacities, a lot of training Schools and curses are being introduced in the country to enables users understand and be able to use these machines while benefiting the satisfaction the advanced countries have been driving.

Changes in Computer 

   

         The following are some changes which the computer has undergone through its development over the years. Advancement in the use of integrated circuits embedded in minutes electronic drips have led to the development of smaller computers that are able to process more and more data at a reasonable cost. Before the mid-1980s, banking operation in Nigeria were carried out manually, the phenol men a made banking operation to be cumbersome and tasking bankers with their customers, while some of the products service rendered in banking world were practically impossible, (Ndam 2008). 

         According to Esedase (2008) information technology has had a great effect in the Computerization of banking and other financial services worldwide. This was further confirmed by Unebu (2000) when he said that Nigerian banks began to embraces computer technology in the mid-1980s as a way of producing better service delivery and higher revenue generation. In his word " the acquisition of computers where done to increase productivity and efficiency", Computerization of most banks started at the corporate head office of most banks and in some choice branches. This gradually spread to their operations. Computerization also became a competitive weapon used by bank to gain wider access to the banking sector market. 

   

               By the early 1990s, the Central Bank of Nigeria came with regulatory policy which made Computerization auditory for banks in Nigeria. Most banks quickly embraced the Local Area Network (LAN) and Wider Area Network (WAN) which has been very instrumental in giving wine access's to users at any time. Some banks have engage USAT connections and other radio transmission method for the same purpose. The first electronic computer using electronic mechanized Device (Mark)

    

           Howard (1944) was developed by prof. Howard, a university physics. His work completed in 1944 has worked for seven years, at the more school of electronic engineering. The first of all electronic computers ENIAC (Electric numeric Integrator and educator) was built by J. Preepar Eckert and John N. Marchy. By today's standard, the ENIAC was very slowly and unreliable although it presented a giant step in technological process. Soon in the same pennsylvania, a more versatile computer was developed. This I/was the EDVAC (Electronic Discrete Variable Automatic Calculator) and it was the world first commercial electronic data processing machine. About the same period, The EDSAC was developed the first commercially available computer was the UNVAC (Universal Automatic Computer) which was appeared in 1951. This was developed by Ekert and Monchy, the UNVAC stood alone in the field of Computer until 1954 when many companies introduced competitive models into the computer area. Since then, series of redical breakthrough in electronic computer have occurred with each major breakthrough being based upon the older form of electronics and replaced but a new generation first generation.

4. Framework of Computer System

        

                                  

CHAPTER TWO: REVIEW OF RELATED LITERATURE

CHAPTER THREE: RESEARCH METHODOLOGY

CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS

CHAPTER FIVE: SUMMARY CONCLUSION AND RECOMMENDATIONS

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