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The banking sector is facing new challenges with the emergence of different segments of customers with different demands, according to Mr M. Damodaran, former chairman of the Securities and Exchange Board of India (SEBI).
He said young customers were generally impatient and demanded faster processes and more products.
They were moving away from the conventional banking mode to ‘branchless' banking through ATMs and even ‘bankless' banking by using cards for purposes such as shopping. He was speaking at a function to inaugurate the renovated headquarters building of the South Indian Bank (SIB) in Thrissur on Saturday.
Complaints
Mr Damodaran, who is also the chairman of the committee formed by the Reserve Bank to look into the various aspects of customer services in the banking sector, said 41 out of the 100 complaints that reached the bank were regarding the functioning of ATMs. And the complaint reached the bank even before the customer, obviously a youngster, left the ATM.
The second category of customers, the older clients, visited the banks mainly to have a chat with the branch officials and also do business in between, Mr Damodaran said and advised banks to go to the third type of customers, the financial inclusion account holders, and explain to them about the safety of their savings with the banks.
Referring to an article that said ‘India should move like a fleet-footed tiger and not as a sleepy elephant,' he said it was wrong to imitate ‘tigers' because ‘tiger economies' in South East Asia had already crumbled. Elephants were sure-footed animals and hence the elephant was the right symbol of the country's banking sector. ‘Solidity' and not being ‘spectacular' should be the aim of the banks, Mr Damodaran said.
Changing dynamism
Mr Azim Premji, Chairman of Wipro, who inaugurated the building, said banks should be prepared to face the changing dynamism of the world.
He said the economic crisis that gripped the banks in the US and European countries, did not affect the Indian banking system because of the regulations put in place by the Reserve Bank and also due to the self-discipline of the banks.
Mr Premji pointed out that financial inclusion in India at present compared poorly with its peers in Asia, as bank branches existed only in around nine per cent of the villages in the country. The financial inclusion drive should cover agriculture and rural sectors and the penetration could be achieved by increasing the use of tools like information technology.
SIB new branches
SIB has opened 30 new branches across the country, taking the total number of branches to 640.
The bank had opened 30 new branches in September last year and the total number of new branches added to the network in the current financial year has reached 60.
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