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Cost Analysis

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Cost analysis
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  5. SOCIAL COST-BENEFIT ANALYSIS OF MOBILE BANKING Cost-benefit analysis is mainly, but not exclusively, used to assess the value for money of verylarge private and public sector projects. This is because such projects tend to include costs and benefits that are less amenable to being expressed in financial or monetary terms (e.g.environmental damage), as well as those that can be expressed in monetary terms. 5.1. DEFINITION OF CBA Cost-enefit !nalysis (C!) estimates and totals up the e uivalent money value of the benefitsand costs to the community of projects to establish whether they are worthwhile. 5.2. PRINCIPLES OF COST BENEFIT ANALYSIS #ne of the problems of C! is that the computation of many components of benefits and costs isintuitively obvious but that there are others for which intuition fails to suggest methods of measurement. Therefore some basic principles are needed as a guide. $.There %ust e a Common &nit of %easurement'.C! aluations hould *epresent Consumers or +roducers aluations !s *evealed by Their !ctual ehavior .enefits !re &sually %easured by %aret Choices.ome %easurements of enefits *e uire the aluation of /uman 0ife1.The !nalysis of a +roject hould 2nvolve a 3ith ersus 3ithout Comparison4.The !nalysis of a +roject hould 2nvolve a 3ith ersus 3ithout Comparison5.6ouble Counting of enefits or Costs %ust be avoided7.6ecision Criteria for +rojects 5.3. EXAMPLES For SCBA I consider the following variables From Bank point of view   Administrative Cost    Smart card costFrom Client point of view   Reduce cost   Save money Administrativ C!st Bank expends some cost for clients suppose they recruit employee for clientand also provide some paper materials for transactions!For example a person wants to transfer some amount money to otheraccount! Bank provides some papers for this transaction and recruits anemployee for #$$ clients in a day! In the case of existing system followingsare steps followed for the above service!%Clients go to the branch%Fill up a form%A bank employee checks that and transfers the money!Suppose &aper cost ' #!$$ tk per transactions(mployee cost' )$$$$ tk per month for #$$ clients every day*ow we consider the following real example to +nd out the bene+t of theproposed system! ,e consider that the above process comes under theproposed -%banking infrastructure! So it performs all remittance functions inreal time!,e can +nd out the net pro+t calculated.*et pro+t ' /#0#$$0))0#)1 2 /)$$$$0#)1 ' )34$$ 2 )4$$$$ ')334$$ tk  CONCL#$ING %EMA%KS   If the above function is done with the traditional banking system society willincur a loss amount to tk )334$$!$$ but under the -obile banking systemsociety will gain by expediting the transaction! So from the social perspectivethe -obile banking pro5ect is acceptable! Smart &ard &!st Bank issue a smart card for their clients! Suppose Smart card cost is 6$ taka for per client!(very day average 7$ people open account in bank! So in a month smartcard cost for bank is 66$$$ tk!*ow we consider the following real example to +nd out the bene+t of theproposed system! ,e consider that the above process comes under theproposed -%banking infrastructure! So there is no need of smart card clientdraw their money by pin number from A8- booth!,e can +nd out the net pro+t calculated.*et pro+t ' 7$06$0))0#) ' 6 93$$$ tk CONCL#$ING %EMA%KS If the above function is done with the traditional banking system society willincur a loss amount to tk 6 93$$$!$$ but under the -obile banking systemsociety will gain by expediting the transaction! So from the social perspectivethe -obile banking pro5ect is acceptable! %d'& C!st If clients want to transfer money in:uiry balance he;she have to go bank! (xamle %r 8 wants to transfer money to %r 9. %r 8 have to go an ranch which in wherericshaw is the only and main means of communication. !fter completing the form, 60 willtransfer it. The social cost of that community will be lie this:!ssumption:  %  ;eed < taa for one way transport cost %  ;eed $.1 hour to finish all procedure *ow we consider the following real example to +nd out the bene+t of the proposed system! ,e consider that the above process comes under the proposed -%banking infrastructure! So there is no need to go bank branch client transfer their money by their mobile phone instantly!,e can +nd out the reduce cost calculated.Reduce Cost ' /6$0)1tk ' 3$ tk  8ime save ' #!7 hours CONCL#$ING %EMA%KS 2f %obile baning services are available the reduce cost would be t4< and time saved $.1hours. ;o doubt about the clients personal benefit of the %obile baning. Sav m!n( If clients open a traditional bank account Bank charges 39$ tk yearly for debit card and others!*ow we consider the following real example to +nd out the bene+t of the proposed system! ,e consider that the above process comes under the proposed -%banking infrastructure! So there is no need to debit card and there is no charges will deducted from account! CONCL#$ING %EMA%KS 2f %obile baning services are available then client save 4=< t per year. ;o doubt about theclients personal benefit of the %obile baning.
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