Bankers on Marine Drive

Dear Readers,

Bankers in India are often at the receiving end of “It’s always lunchtime” jokes, especially the ones from public sector banks. So it was a sight to behold when 200 officers from Indian Bank arrived at Marine Drive early morning for work.

Well, the bankers had an important job to do at the promenade and their bank’s bottom line depended on it. They were out to canvass their bank’s deposit schemes to joggers who often happen to be the rich ones at the tony South Mumbai seashore.

The Indian Bank officers were holding placards detailing the bank’s various deposit schemes.

Deposit rush

Earlier, another PSU, Canara Bank, conducted a door-to-door campaign for garnering deposits. With deposit growth moderating, the scheduled commercial banks are facing a fund crunch in meeting the huge surge in credit demand. Not just PSBs, but a few private banks have also launched marketing campaigns for their deposit schemes. As RBI began increasing the policy rates to counter inflation, banks have also got a window to raise deposit rates and are advertising them to a host of customers.

It's heartening to see PSU banks holding such activities but they will have to work harder, given the competition from private sector banks. My strong view is for decades PSU banks took customers for granted. Now that private sector banks have grabbed a considerable market share, new-age banks are getting popular and FinTechs have changed the whole dynamics of the finance game, PSU banks facing the heat. At the same time, there is a generational shift in customers. Millennials and GenZ, which now form a bulk of the customer base, want better UI and UX and customer experience.

It's also the time for PSU banks to introspect about why most of the corporates ignore them to choose private banks for salaried accounts. Whether they have built a robust system to serve young customers? More importantly, whether they have trained their employees enough on all fronts, such as digital, protocols of customer service and a strong server base? The RBI Ombudsman receiving 1,54,725 complaints against PSU banks in 2021-22 should be a wake-up call.

In the world of Banking-as-a-Service and the evolution of digital, mobile banking will touch new levels. And in my view, PSU banks will have a tough time competing with the new-age finance companies, as the possibility of there being only digital and neobanks in the future cannot be ignored.

India story

The US inflation numbers that were released this week brought some relief. The inflation has fallen to 6.5 per cent, which will reduce the pressure on the US Fed to aggressively hike rates, easing recession concerns a bit. The World Bank has forecast India’s FY23 GDP growth at 6.9 per cent, saying that the country will be the fastest-growing economy among the seven largest ones.

Apart from this, Prime Minister will launch the world's longest river cruise on Friday. The cruise MV Ganga will visit 50 tourist spots and traverse 27 rivers. The luxury tour will cover 3,200 kilometres covering incredible destinations. The cruise is already booked for the next two years. It will sail from Varanasi after Ganga Aarti. I think this is a remarkable move to strengthen and expand India’s travel horizon.

In the second episode of the Live Budget Series, we unwrapped the expectations of the NBFC sector. Click here to watch the full episode. Next week we will cover the insurance sector.

This week we interviewed Ranvir Singh, Founder and CEO of Ring (earlier known as Kissht). He said that only those FinTechs who own the customers can get a better price from banks. Also, we have been doing a series of stories on 2023 outlook stories. Click here.

Also, ETBFSI is holding its annual excellence awards in February, which is now for entries. Click here to nominate your innovation.

Apart from this, I am adding here the top five stories of the week that you shouldn't miss. If you have any thoughts or feedback, please feel free to share them with me at amol.dethe@timesinternet.in.

1) How India can push the climate finance agenda at G20

2) Blockchain co-inventor Stuart Haber says his technology can improve transparency and assurance in banks

3) Who can be the suitors for IDBI Bank?

4) ONDC allows MSMEs to compete on equal footing with large market players: Bank’s Divyesh Dalal

5) Budget 2023: Govt should come out with plain Jane, boring Budget: Economists

Happy Reading,

Amol Dethe

Editor,

ETBFSI