According to the Executive Summary of these guidelines, their purpose "is to express supervisory expectations and guidance as to banks carrying out cross-border electronic banking activities, as well as to their home and host supervisors."

The guidelines focus on two main areas:

• identifying "banks’ risk management responsibilities with respect to cross-border e-banking," and
• drawing attention to "the need for effective home country supervision of cross-border e-banking activities as well as continued international cooperation between banking supervisors regarding such activities. This is essential to promote safe and sound cross-border e-banking without creating undue regulatory burden or impediments to banks’ use of the Internet delivery channel to meet customer needs."

In recent years, the spread of e-banking activities has given rise to many cross-border challenges. As explained in a document by the Basel Committee on Banking Supervision, entitled Electronic Banking Group Initiatives and White Papers (Publication No. 76 - 2000) (available free of charge):

"E-banking is based on technology that by its very nature is designed to expand the 'virtual' geographic reach of banks and customers without necessarily requiring a similar 'physical' expansion. Such market expansion can extend beyond national borders, which significantly increases cross-border cooperation challenges for bank supervisors due to:

"(i) The potential ease and speed with which banks located anywhere in the world can conduct activities with customers over interconnected electronic networks into countries where a bank is not licensed or supervised.

"(ii) The potential ability of a bank or non-bank to use the Internet to cross borders and to seamlessly link banking activities that have typically been subject to supervision with non-banking activities that might be unsupervised by any financial market authority.

"(iii) The practical difficulties faced by national authorities wishing to monitor or control local access to e-banking sites originating in other jurisdictions without the cooperation of home country authorities."