Trends in the Indian banking industry

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: The current year has seen some very positive influences on the financial industry. A host of initiatives have been taken in the recent past to ramp up the regulations for the private banking sector and along with that a new dimension in outlook toward customers, technology and banking as a sector on the whole has been adopted.

Looking ahead, the banks need to identify their key focus area for the coming year and work towards building a comprehensive and focused growth strategy for themselves enabling them to draw out their respective plans. Given the cut-throat nature of bank competition, targeted technology investments with measurable RoI can provide solid opportunities for them.

Banks are also succeeding at reallocating IT resources away from maintenance to new projects, though maintenance costs still weigh heavily. This reallocation is crucial given that the strategic IT investments of today are the competitive differentiators of tomorrow

Highlighted are some of the relevant issues that banks face today:

Standardisation is the key

The method a bank adopts literally emanates what school of thought it follows, and can very well be an indicator of their growth strategy for the coming years. Multiple applications in any organization can cause a lot of confusion in operations.

Also, variation in applications at each level and each segment might result in hindrance in output by the organization. This can be simply avoided by standardising processes, eliminating redundancies and rationalising the applications. Standardisation of processes and technology used acts as a launch pad for inducting any new product in the organisation and it also helps the bank elevate from processing obstacles.

Reduce operational discrepancies

Cost reduction is one of the most important concerns for any organisation. Inculcating economic rationale in processes bring about a considerable difference to the balance sheet. This cost reduction can take place through standardisation of processes.

For eg: One customer could be availing of the savings account facility and also of the credit card facility. In this case there could be a standardised process to recognise customers using multiple services in the bank as opposed to customers using singular services. Accordingly, one could de-fragment the wide customer base.

It will be exhaustive for the bank to run multiple processes for each service provided for, and also shoot up the risk undertaken by the institution. Standardising processes would help to recognise similarity in various functions and enable in clubbing together similar processes.