Operating System

An operating system (OS) is system software that acts as an interface between the user and the computer hardware. It manages all hardware and software resources of a computer system and provides an environment in which application programs run. Examples: Windows, Linux, macOS, Android.

Role of Operating System as a Resource Manager

The OS acts as a resource manager because a computer has limited resources (CPU, memory, I/O devices, storage) which must be shared among many programs and users efficiently and fairly. Its main roles are:

1. Process/CPU Management – It decides which process gets the CPU, for how long, and in what order (scheduling), so that the CPU is utilized maximally and no process is starved.
2. Memory Management – It allocates memory to programs, keeps track of which part of memory is in use, and frees memory when a process ends. It also handles virtual memory and swapping.
3. Device / I/O Management – It controls I/O devices through device drivers, allocates devices to processes, and manages input/output operations so that devices are shared without conflict.
4. File / Storage Management – It creates, deletes, reads and writes files, manages directories, and allocates disk space to files.
5. Resource Allocation and Accounting – It decides which process gets which resource and keeps records of resource usage for performance monitoring and billing.
6. Security and Protection – It prevents unauthorized access to resources by one process or user against another, and controls access rights.
7. Coordination and Synchronization – It coordinates and synchronizes the activities of multiple processes so that they do not interfere with each other while sharing resources.

Thus, the OS ensures that all resources are used efficiently, fairly and without conflict among competing processes.

Information technology (IT) has become the backbone of modern banking, transforming banks from paper-based institutions into fast, accurate and connected service providers. Its main roles are:

1. Core banking and automation — Core banking systems (e.g. Pumori, Finacle) centralise all branches on one platform, so a customer can deposit in one branch and withdraw from another. Routine jobs like interest calculation, ledger posting, and balance updating are done automatically, reducing errors and staff workload.

2. Anywhere, anytime banking — ATMs, debit/credit cards, mobile banking, internet banking and QR payments let customers check balances, transfer funds, pay bills and shop 24/7 without visiting a branch. This saves time and expands the bank's reach beyond its physical branches.

3. Speed and accuracy in transactions — Electronic Funds Transfer (EFT), Real Time Gross Settlement (RTGS), connectIPS and remittance systems settle payments within seconds, including cross-border remittances. Manual calculation errors and long queues are largely eliminated.

4. Better customer service and products — IT enables SMS/email alerts, online statements, digital account opening (KYC), loan processing software and chatbots. Banks can also design new products such as digital wallets, online fixed deposits and card-based credit.

5. Risk management, security and compliance — IT supports fraud detection, anti-money laundering (AML) monitoring, CCTV and biometric verification. Encryption, firewalls and OTP verification protect customer data and money, while systems help meet Nepal Rastra Bank's reporting requirements.

6. Decision-making and MIS — Management Information Systems give real-time data on deposits, loans, liquidity and profitability, helping management take quick, evidence-based decisions. Data analytics also helps assess creditworthiness and target customers.

7. Cost reduction and efficiency — Digital channels cost far less per transaction than branch counters, improving profitability and allowing banks to serve more customers with fewer resources.

Conclusion: IT has made banking faster, safer, cheaper and more accessible. In Nepal too, from ATMs and mobile banking to connectIPS and digital lending, IT is the key driver of modern banking — though it must be backed by strong cybersecurity and reliable infrastructure.

Operating System

An operating system (OS) is system software that acts as an interface between the user and the computer hardware. It manages hardware resources (CPU, memory, storage, input/output devices), provides a platform for running application programs, and offers services such as file management, process scheduling, memory allocation, and security. Examples: Windows, Linux, macOS, DOS, Android.

Difference between Linux, Windows and DOS

In short, Linux is open-source and highly secure, Windows is user-friendly and widely used but proprietary, while DOS is an old command-line-based single-tasking system.

Database: A database is an organised collection of related data stored in a structured form so that it can be easily accessed, managed, and updated. For example, a bank's database stores customer details, account numbers, balances, and transaction records in a systematic way.

Advantages of a Database Management System (DBMS):

1. Controlled redundancy: Data is stored in one central place instead of being duplicated in many files, so unnecessary repetition is reduced.
2. Data consistency and integrity: Since data is stored once and updated everywhere, conflicting values are avoided and accuracy is maintained.
3. Easy data sharing: Multiple users and departments (e.g., accounts, loans, ATM services) can access the same data simultaneously as per their authority.
4. Data security: A DBMS provides user authentication, passwords, and access rights, so only authorised users can view or modify sensitive data.
5. Data independence: The logical structure of data can be changed without altering the application programs that use it.
6. Efficient query and retrieval: Data can be searched, filtered, and reported quickly using query languages such as SQL.
7. Backup and recovery: The DBMS supports automatic backup and restore facilities, protecting data from loss due to failure.
8. Concurrent access control: Many users can work on the database at the same time without interfering with each other's transactions.

(d) MS Word

MS Word is an application (word-processing) software, not an operating system. Windows 10, MS-DOS and Linux are all operating systems.

(b) Hyper Text Transfer Protocol Secure

HTTPS stands for Hyper Text Transfer Protocol Secure. It is the secure version of HTTP, where communication between the browser and the website is encrypted using SSL/TLS, so data cannot be easily read or tampered with in transit.

(a) B5

A cell reference in MS-Excel is written as the column letter followed by the row number, so cell in column B and row 5 is written as B5. The other options are not valid Excel cell reference formats.

(c) Google Chrome

Google Chrome is a web browser used to access and view websites on the internet. Microsoft Word is a word processor, Windows Explorer is a file manager, and Outlook Express is an email client.

(b) To create a consistent design template for all slides in a presentation

The Slide Master stores the layout, fonts, colours, background and placeholder positions for every slide, so a change made once on the master is applied to all slides — giving the whole presentation a uniform look.

(c) Margin that is added to the binding side of page when printing

A gutter margin is extra space added to the inner edge (the binding side) of a page so that text is not lost in the binding when the document is printed and bound. In Word, the gutter is added to the left margin for normal documents and to the inner margin for facing pages.

(b) Relational Database Management System

RDBMS stands for Relational Database Management System — software that stores data in tables (relations) and manages them using SQL. Note that options B and C are identical; the correct expansion is "System," not "Software."

(b) Word Processing System (WPS)

A word processing system is general office application software used for creating and editing documents. It is not a type of Management Information System. The common types of MIS are Transaction Processing System (TPS), Decision Support System (DSS), Executive Support System (ESS), and Management Reporting System.

Section 2: General IT

2.1 History and Development of IT in Nepal

Key milestones (short-answer points):

Development phases:

1. Punch-card / mainframe era (1971–1980) — census, statistics only.
2. Microcomputer era (1980s) — PCs in offices, NCC, computer education begins.
3. Networking & Internet era (1990s) — CAN, email, commercial ISP, dot-com growth.
4. Policy & e-governance era (2000s) — IT Policy 2056, ETA 2063, e-governance, ICT in banking.
5. Digital Nepal era (2015–present) — broadband expansion, mobile banking, fintech, Digital Nepal Framework, Cybersecurity Policy 2080.

Present status: IT is a priority sector; IT service export is a major foreign-currency earner; banks run fully digital channels (ABBS, mobile banking, cards); government services are moving online (Nagarik App, e-passport, online tax filing).

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2.2 Electronic Transaction Act (ETA), 2063 (2008)

Purpose: To make electronic transactions, digital signatures and electronic records legally valid and enforceable, and to control computer-related crime.

Main provisions:

1. Legal recognition of electronic records and digital signature — an electronic record/signature has the same legal effect as a paper document and handwritten signature.
2. Authentication of electronic records — through a digital signature issued by a licensed Certifying Authority (CA).
3. Controller of Certifying Authorities — the Ministry of Science and Technology (now under MoCIT) acts as Controller; licenses CAs.
4. Rights and obligations of subscribers — duty to keep private key secret; liability for misuse.
5. Electronic transactions valid — offer, acceptance and contract can be made electronically.
6. Cyber offences and penalties (key ones):

7. Digital signature — asymmetric cryptography (public + private key); private key kept secret, public key published.
8. Adjudicating authority — designated by the Government (officer at Joint Secretary level or above); appeal lies to the Supreme Court.
9. Cyber Tribunal / Cyber Appellate — provision for a Cyber Tribunal to try cyber offences.

Importance for banking: gives legal backing to online banking, e-payments, ATM transactions, digital contracts and electronic cheques; makes digital signature legally acceptable; provides punishment for hacking, phishing and data theft in banks.

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2.3 Cybersecurity Policy, 2080 (2023)

Approved by: Council of Ministers, 2080 BS (2023 AD); Ministry of Communication and Information Technology is the lead agency.

Objectives:

• Create a safe, secure and trustworthy cyberspace in Nepal.
• Protect critical information infrastructure (CII) — banking, telecom, power, health, government.
• Protect citizens' privacy and personal data.
• Build cyber-resilience and incident response capability.
• Promote cyber awareness, education and skilled manpower.
• Strengthen legal and institutional framework against cyber crime.

Key strategies/provisions:

1. Establishment of a National Cyber Security Centre and a Cyber Security Emergency Response Team (CERT).
2. Identification and protection of Critical Information Infrastructure.
3. Data protection and privacy safeguards; secure handling of personal data.
4. Public–private partnership in cyber security.
5. Cyber security audit of government and critical systems.
6. Development of cyber security human resources and curriculum.
7. International cooperation in cyber crime investigation.
8. Legal reform to update ETA 2063 and related laws.

Relevance to banks: banks are CII; policy requires security audit, incident reporting, data protection and business continuity in banking IT systems.

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2.4 NRB IT Policy (Information Technology Policy, 2072)

Issued by: Nepal Rastra Bank to regulate and promote IT in banks and financial institutions (BFIs).

Objectives:

• Promote safe, secure and reliable IT use in BFIs.
• Ensure data integrity, confidentiality and availability.
• Support financial inclusion through digital channels.
• Standardise IT governance, risk management and audit in BFIs.

Key provisions:

1. IT Governance — Board-approved IT policy, IT steering committee, clear roles of CEO/CIO.
2. IT Risk Management — identify, assess and mitigate IT risks; Business Continuity Plan (BCP) and Disaster Recovery (DR) site mandatory.
3. Information Security — access control, encryption, password policy, firewall, antivirus, patch management.
4. Data Centre & Network — secure data centre, redundancy, backup policy.
5. Outsourcing — approval of NRB before outsourcing core IT services; vendor risk management.
6. IT Audit — periodic internal and external IT audit; report to Board and NRB.
7. E-banking — prior approval for new electronic banking products; customer awareness and grievance handling.
8. Cyber Security — incident reporting to NRB, CERT and Nepal Police within prescribed time.
9. Payment Systems — compliance with Payment Systems Act 2075 and NRB directives on digital payments.

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2.5 E-banking Products

(a) Debit Card

• Issued against a deposit (savings/current) account; spending limit = balance in the account.
• "Pay now" instrument — money is debited immediately from the customer's account.
• Uses: ATM withdrawal, POS purchase, online payment, bill payment.
• Types: Classic, Gold, Platinum, Visa, Mastercard, UnionPay; domestic and international.
• No credit risk to bank (own money); annual fee and transaction charges apply.

(b) Credit Card

• Issued against a credit limit sanctioned by the bank; "pay later" instrument.
• Customer can spend up to the limit and repay within the interest-free period (usually 45–50 days); after that interest is charged.
• Types: Classic, Gold, Platinum, Corporate; revolving credit facility.
• Risk: credit risk and fraud risk to the bank; requires KYC, income proof and collateral/guarantee in some cases.

(c) ATM (Automated Teller Machine)

• 24×7 self-service machine for cash withdrawal, balance enquiry, mini statement, PIN change, fund transfer.
• Components: card reader, PIN pad, cash dispenser, receipt printer, screen, host computer link.
• Types: cash dispenser, full-function ATM, recycle ATM, white-label ATM.
• Security: PIN, EMV chip, camera, daily withdrawal limit.
• Benefits: convenience, less branch crowd, anytime banking.

(d) ABBS (Any Branch Banking System)

• Customer can deposit/withdraw from any branch of the same bank, not only the home branch.
• Requires centralized database and network connectivity between branches.
• Benefits: mobility, time saving, better customer service, single-account view.
• Risk: network failure, data security, need for strong access control.

(e) SWIFT (Society for Worldwide Interbank Financial Telecommunication)

• International interbank messaging network for cross-border payments (remittance, LC, trade finance).
• Provides secure, standardized financial messages (MT103 for customer transfer, MT202 for bank transfer, MT700 for LC).
• Nepal: NRB and commercial banks are SWIFT members; SWIFT code (BIC) identifies each bank.
• Benefit: fast, authenticated international transactions; no physical movement of money — only messages, settlement through correspondent banks.

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2.6 Online and Mobile Banking

Online Banking (Internet Banking):

• Banking through a website/browser using user ID, password and OTP.
• Services: balance enquiry, statement, fund transfer, bill payment, cheque book request, FD opening, tax payment.
• Requires internet connection, digital security (SSL, OTP, 2FA).

Mobile Banking:

• Banking through a mobile app / USSD / SMS on a smartphone.
• Services: fund transfer, QR payment, mobile top-up, bill payment, balance enquiry, mini statement, card control.
• Examples in Nepal: eSewa, Khalti, IME Pay, Mobile Banking apps of NIBL, NIC Asia, Global IME, etc.
• Features: 24×7 access, low cost, financial inclusion, instant notification.

Difference (quick table):

Risks: phishing, SIM swap, malware, password theft — controlled by OTP, 2FA, encryption, customer awareness.

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2.7 Management Information System (MIS)

Definition: MIS is a computer-based system that collects, processes, stores and provides timely, accurate and relevant information to managers for planning, decision-making, coordination and control.

Components:

1. Hardware — computers, servers, networks.
2. Software — application and system software.
3. Data/Database — organized business data.
4. People — users, managers, IT staff.
5. Procedures — rules and methods of operation.
6. Network/Telecommunication — connectivity.

Functions:

• Data collection and processing
• Information storage and retrieval
• Report generation (daily, weekly, monthly, exception reports)
• Decision support and control
• Communication within the organization

Characteristics: management-oriented, integrated, common database, report-oriented, flexible, accurate and timely.

Benefits in banking:

• Customer information system (CIS) — KYC, account details, transaction history.
• Loan management system — appraisal, disbursement, repayment, NPA monitoring.
• Deposit and GL system — daily trial balance, P&L, balance sheet.
• HR and payroll system.
• Regulatory reporting to NRB (BFR, SRP, ESS).
• Faster decision-making, reduced errors, better customer service, fraud detection.

Levels of MIS: operational (TPS), tactical (MIS/DSS), strategic (EIS).

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2.8 Cyber Crime and Code of Conduct

Cyber Crime — definition: Any illegal act committed using a computer, network or electronic device, where the computer is either the target or the tool of crime.

Types of cyber crime:

Legal provisions in Nepal: Electronic Transaction Act 2063 (Sections 45, 46, 47, 53, 58), Cyber Security Policy 2080, Payment Systems Act 2075, Nepal Police Cyber Bureau.

Code of Conduct (IT / banking context):

1. Use official IT resources only for official work.
2. Do not share user ID, password, PIN, OTP or private key with anyone.
3. Maintain confidentiality of customer and bank data.
4. Do not access data beyond one's authority.
5. Report security incidents/cyber crime immediately to the IT/security department.
6. Follow backup, antivirus, patch and password policies.
7. Avoid pirated software and unauthorized devices on the bank network.
8. Respect privacy of customers and colleagues.
9. Follow NRB directives and bank's IT policy strictly.
10. Cooperate in IT audit and investigation.

Preventive measures: strong password, 2FA/OTP, updated antivirus, firewall, regular backup, employee awareness training, secure disposal of e-waste, and prompt reporting to Cyber Bureau (1114 helpline).

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Quick Revision — One-liners

• First computer in Nepal: IBM 1401 (1971 AD / 2028 BS) for census.
• First ISP: Mercantile Communications (1995 AD).
• First IT Policy: 2056 BS; current: IT Policy 2072.
• ETA 2063 gives legal validity to electronic records and digital signature.
• SWIFT = international interbank messaging, not a payment system itself.
• ABBS = Any Branch Banking System.
• NRB IT Policy mandates BCP and DR site for BFIs.
• Cyber crime law in Nepal: ETA 2063; investigating agency: Cyber Bureau, Nepal Police.

5.2 Basic Knowledge of System Administration

1. Meaning of System Administration

System administration is the process of managing, maintaining, configuring, and troubleshooting computer systems, servers, networks, and their users so that they run reliably, securely, and efficiently. The person who performs these tasks is called a System Administrator (SysAdmin).

In simple words, a system administrator keeps the IT infrastructure of an organization "alive and healthy" — installing operating systems, managing user accounts, applying security patches, taking backups, and solving problems when they arise.

2. Key Responsibilities of a System Administrator

3. Main Duties in Detail

(a) User and Group Management

• Add/remove users, set passwords, define permissions (read, write, execute).
• Create groups for role-based access (e.g., "teller", "manager" in a bank).
• Follow the principle of least privilege — give only the access needed.

(b) Operating System Management

• Install and update OS (Windows Server, Linux distributions).
• Apply security patches and service packs regularly.
• Manage processes, services, and system logs.

(c) File System and Storage Management

• Create partitions, manage disk space, set quotas.
• Share folders and set share-level and NTFS/file permissions.

(d) Backup and Disaster Recovery

• Full, incremental, and differential backups.
• Store backups off-site; test restore procedures.
• Prepare a Disaster Recovery (DR) Plan.

(e) Security Administration

• Configure firewall, antivirus, and intrusion detection.
• Enforce password policy (length, expiry, complexity).
• Monitor unauthorized access; audit logs.
• Apply the CIA triad: Confidentiality, Integrity, Availability.

(f) Performance Monitoring and Tuning

• Use tools like Task Manager, Performance Monitor, top, df, netstat.
• Identify bottlenecks (CPU, RAM, disk I/O, network).

(g) Troubleshooting

• Follow a systematic approach: identify → isolate → fix → verify → document.
• Handle hardware failures, boot errors, network issues, and application crashes.

4. Common Tools Used

• Windows: Task Manager, Event Viewer, Disk Management, Active Directory, PowerShell.
• Linux: top, ps, df, du, chmod, chown, systemctl, cron, rsync.
• Network: ping, ipconfig/ifconfig, tracert, nslookup.
• Security: Firewall, antivirus, backup software (e.g., Acronis, Veeam).

5. Importance in a Bank (e.g., Nepal Bank)

• Ensures 24×7 availability of banking software (CBS, ATM, mobile banking).
• Protects customer data and financial records from theft or loss.
• Ensures regulatory compliance (NRB IT directives, data retention rules).
• Minimizes downtime and financial loss due to system failure.
• Supports audit trails and accountability.

6. Skills Required

• Knowledge of operating systems (Windows/Linux).
• Networking fundamentals (IP, DNS, DHCP, subnetting).
• Hardware and software troubleshooting.
• Basic scripting (Bash, PowerShell).
• Security awareness and backup tools.
• Good communication and documentation skills.

7. Conclusion

System administration is the backbone of any organization's IT environment. A competent system administrator ensures that systems remain available, secure, and efficient, which is critical — especially in a banking environment where even a few minutes of downtime can cause significant financial and reputational damage.

6. Cyber Security

5.3 Introduction and Importance of Cyber Security

Introduction: Cyber security is the practice of protecting computers, servers, mobile devices, networks, and data from digital attacks, damage, or unauthorized access. It covers the technologies, processes, and human practices used to defend systems connected to the internet. In simple terms, it is the protection of information and information systems from theft, alteration, disruption, and destruction.

Key elements (CIA Triad):

• Confidentiality – information is accessible only to authorized persons.
• Integrity – data is accurate and has not been tampered with.
• Availability – systems and data are available to users whenever needed.

Importance:

1. Protects sensitive data – personal details, bank records, and government secrets are kept safe from theft.
2. Prevents financial loss – cyber attacks such as online fraud and ransomware cause huge monetary damage.
3. Maintains trust and reputation – customers trust banks and institutions that keep their data secure.
4. Ensures business continuity – protects systems from disruption so services run without interruption.
5. Safeguards national security – protects critical infrastructure like power grids, defence systems, and communication networks.
6. Protects privacy – prevents misuse of personal information.
7. Legal compliance – helps organizations meet laws such as the Electronic Transactions Act, 2063 and data protection rules.

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5.4 Common Threats and Tools for Protection

Common Cyber Threats

1. Malware – malicious software such as viruses, worms, trojans, spyware, and ransomware that damage or steal data.
2. Phishing – fake emails, messages, or websites that trick users into revealing passwords, OTPs, or bank details.
3. Hacking / Unauthorized access – gaining illegal entry into a system to steal or alter data.
4. Denial of Service (DoS/DDoS) – flooding a server with traffic so that genuine users cannot access it.
5. Man-in-the-Middle (MITM) attack – secretly intercepting communication between two parties.
6. Identity theft – stealing someone's personal information to commit fraud in their name.
7. Social engineering – manipulating people psychologically to reveal confidential information.
8. Password attacks – brute force, dictionary, or credential-stuffing attacks to guess passwords.
9. SQL injection – inserting malicious SQL code into input fields to access or destroy a database.
10. Zero-day attack – exploiting a software weakness before the developer releases a fix.

Tools and Methods of Protection

a) Firewall

• A firewall is a network security system that monitors and controls incoming and outgoing traffic based on predefined rules.
• It acts as a barrier between a trusted internal network and untrusted external networks (like the internet).
• Types: packet filtering, stateful inspection, application/proxy firewall.
• It blocks unauthorized access while allowing legitimate communication.

b) Antivirus / Anti-malware

• Software that detects, prevents, and removes malicious programs.
• Works by scanning files, comparing against a virus signature database, and using heuristic/behavioral analysis.
• Examples: Windows Defender, Norton, Kaspersky, Avast.
• Needs regular updates to recognize new threats.

c) Encryption

• The process of converting plain text into unreadable cipher text using a key, so that intercepted data cannot be understood.
• Symmetric encryption – same key for encryption and decryption (e.g., AES).
• Asymmetric encryption – public key to encrypt, private key to decrypt (e.g., RSA).
• Used in HTTPS, online banking, VPNs, and password storage.

d) Secure Communications

• HTTPS/TLS – encrypts data between browser and website.
• VPN (Virtual Private Network) – creates an encrypted tunnel over the internet.
• SSH – secure remote login.
• Digital signatures and certificates – verify identity and ensure message integrity.
• Firewalls, IDS/IPS – monitor and stop suspicious traffic.

e) Data Privacy

• Data privacy means the right of an individual to control how their personal data is collected, stored, used, and shared.
• Protected by:
  • Strong passwords and multi-factor authentication (MFA)
  • Access control (only authorized users can view data)
  • Data masking and anonymization
  • Regular backup and secure disposal of data
• In Nepal, the Privacy Act, 2075 and Electronic Transactions Act, 2063 provide legal protection.

Cybercrimes

A cybercrime is any illegal act committed using a computer, network, or the internet. Examples:

• Hacking and data theft
• Online banking / ATM fraud, card skimming
• Cyber bullying, stalking, and harassment
• Identity theft and phishing
• Distribution of illegal content
• Ransomware and extortion
• Software piracy and copyright violation

Legal provisions in Nepal:

• Electronic Transactions Act, 2063 (2008) – punishes unauthorized access, damage to computer systems, online fraud, and publication of illegal material.
• Privacy Act, 2075 – protects personal privacy and data.
• Copyright Act, 2059 – protects intellectual property.

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5.5 Cyber Hygiene

Meaning: Cyber hygiene refers to the routine practices and habits that users follow to keep their devices, accounts, and data safe and healthy — just as personal hygiene keeps the body healthy. It is the "preventive maintenance" of digital life.

Key Cyber Hygiene Practices:

1. Use strong, unique passwords – at least 8–12 characters with upper case, lower case, numbers, and symbols; avoid names and dates of birth.
2. Enable multi-factor authentication (MFA) – add OTP or authenticator app on top of the password.
3. Keep software updated – install OS, browser, and application updates to fix security holes.
4. Use licensed antivirus and keep it updated – scan devices regularly.
5. Avoid clicking unknown links or attachments – a common entry point for phishing and malware.
6. Use secure Wi-Fi – avoid public/open Wi-Fi for banking; use VPN if necessary.
7. Back up data regularly – keep copies on external drives or cloud storage.
8. Do not share personal information – be careful on social media and with unknown callers.
9. Lock devices – use screen lock, PIN, or biometrics.
10. Log out of accounts – especially on shared or public computers.
11. Keep the firewall on – do not disable it for convenience.
12. Update and monitor bank accounts – check statements regularly for unknown transactions.
13. Educate yourself and others – stay informed about new threats and safe practices.

Benefits: Reduces risk of data loss, fraud, identity theft, and system downtime; saves money and time; protects reputation; and builds a safer digital environment for everyone.