Convergence in Indian banking Industry

-R.K.Keerthi In this modern competitive world, everything is driven by technology. Global banking industry changed its outlook entirely from normal branch driven services to multichannel offerings (net banking, mobile banking and tab banking) to reach more and more customers with in a short span of time and cost, of-course with more customer satisfaction and profits. To support these noble thoughts of banks, many companies like Accenture, Sandstone, and Polarisft came up with innovative technological products like widget based app store products, multi-channel solutions, role based products used by multiple users (retail customers, corporate clients & bank employees) for multiple purposes .These products provide tailored schemes which are easily accessible by customers all the time and also more importantly, application of data analytics becomes easy. Our Indian banking industry is still in the budding stage of implementing such kind of technology driven products. Banks like Axis bank (Axis mobile 2.0), ICICI bank (Tab banking, Iwish etc.) recently released products on similar lines. Here, the benefits are not for the customers alone. The banks also benefit to a large extent by understanding its customers more profoundly. Only question here is, whether the Indian customers are ready to adapt to these drastic changes that are taking place in banking industry and accept these financial technology products. The main objective of this project is to identify the critical barriers that influence the customers adaptability and also to measure the customers acceptance level for these new financial products. To understand the present trends in Indian banking industry and the penetration level of high digital users, an extensive primary and secondary research was performed. For primary research, a questionnaire was developed and responses were collected from bank employees and customers. Factor analysis and Rank based conjoint analysis were applied to the responses to know the customer acceptance level. Respondents ranked 20 cases, each consisting of 4 factors with different levels. All 4 factors, namely one time Experience (single click login, all products in one place app store based model), Value Add-ons (Trading tips, dynamic view of spending patterns), convenience and personalisation (customised themes and social media-bank account connection) describe the features of these financial products. The empirical results showed that consumers did not prefer personalisation because of security and privacy reasons. The main barriers for not willing to adopt these products are lack of awareness on usage of these services & benefits and also customer perception of cybercrimes. However, secondary research reveals that usage of multiple channels especially internet and mobile banking are going to increase exponentially by 2016. This could be because of increasing usage of mobile and tab banking by Gen Y customers. Future scope of the study involves interviewing industry experts and there by understanding the acceptable features of these financial products by customers.