A robust banking and financial sector is a critical prerequisite for developing and developed economies, as they provide the vital fuel for the engines of economic growth. Mergers and acquisitions have emerged as a major trend in the banking industry. The prime focus is to increase the size and strength, explore opportunities to cross sell various financial products and to sustain against competition.
The banking industry is dominated by private sector and multinational banks. The strength of public sector banks has been their large distribution network. But the techno savvy private and foreign banks have become a threat to them. A large range of new products have been introduced in the retail market by the private and MNC banks, which has made the final market very tough and competitive.
Banking industry is divided into 2 segments.
- Retail
- Corporate and further into 2 subsets, i.e. Assets and Liabilities.
- Managing Wealth & Offering Loan products are the key focus areas.
In this financial market besides Banking, the other intermediaries such as NBFCs and MFs have an important role in credit delivery and mobilization of savings.
NBFCs, due to their inherent strength in credit appraisal, well trained as collection agencies with personalized customer service, are in an excellent position to cater to the needs of small & medium operations especially in semi urban and rural areas. |
