Major Differentiation in Retail Banking in USA, Europe and India 1.

Types of Players in Retail BankingUSA-In America there were existing banks which were running on Brick and mortar lines i.e. had buildings/offices through which they ran which eventually turned to internet banking and majorly Automated Teller Machine and it gave rise to Virtual Banking organizations. Banks there were now involved in Branching and merging across the state lines. The number of banks had fallen from 12500 in 1994 to little more than 2300 in 2003 and Branches rose over time by 8.6 %. Europe- There was basically three types of banks in Europe namely-Public sector, Private commercial and Cooperative Banks. There was intense completion in German Banking Sector with Foreign banks such as Citi and Santander established themselves in highly Competitive Consumer finance segment, and direct players like ING DiBa an online subsidiary of ING Bank of Netherland and players like Deutsche Bank were present in the market. And then the other model which gained popularity was Co-Operation of Retailers and banks which involved companies like Volkswagen and C & A Fashion retailer. India- History of retail banking can be traced back to entry of Foreign Banks. They set the trend which was later followed by Public Sector Banks and Private Banks in India such as ICICI etc. And the latest to join the bandwagon is Non Banking Finance Companies. 2. Portfolio of Services offered USA- Centralized Call Centers to handle customer service issues and to initiate transactions, including Deposits and Loans. There were about 3, 52,000 ATM in USA by 2002. And about 40 Internet Banks. And the banks could also distribute insurance and security products. Europe- Here retail banks introduced Banking via I Phone for the first time in 2007. It also promoted Internet banking and large network of ATM. The major addition to it was when companies like Volkswagen opened a financial subsidiary of its own which worked as a direct bank which looks after about 3,00,000 customers in Germany. And Fashion retailer C & A opened its own bank in 2007 and started offering consumer credits online as well as in stores and then it started distributing motor insurance in partnership with DA Direkt. Some companies also buy or sell shares, Bonds and investment funds. SMS facility is also available which helps consumer keep track of their accounts. India- The basic product in India still remains Credit and Debit Cards and other services like RTGS, Consumer Loans.

Scope for growth USA- Growth is not very significant but Banks have identified it as major revenue generating channel despite the costs associated with it. Europe- The market is growing by a rate of 4% which is not very high. India- It has the largest prospect of growth. Any bank entering in this segment is in a win win situation right now because of growing urban population, emergence of new consumer segment and explosion of Service Economy. Retail assets contribute about 6% to GDP which is quite less as compared to other Asian Counterparts.