Portal : Business World
Headline :Is Banking Disruption On?
Date : 04 May 2016
Edition : Online
Just like the brick & mortar retail sector, banking in India has to change radically or get prepared to be disrupted.
Let's reflect on what's trending in this sector & in the Eco-system.
- financial stress & NPA growth,
- Ongoing fintech disruption of banking technology - e banking led by superior customer experience (just like all online e commerce sectors).
Banking NPA growth is getting reported frequently in the earnings season and is occupying significant mind space.
What seems to be resonating is that the sector is now going after the wilful defaulters with a vengeance - which is good as it's about time that the industry started doing what it should have been doing all along.
The economic slowdown over the last couple of years is also contributing to the rise of NPAs in the sector globally.
Given additional capital/reserve requirements of Basel III compliance, improving profitability & NPA management is right now a priority with the banking sector leadership, besides the bank staff specifically working in areas like business operations, portfolio management, collections, etc. There must be pressure internally to collect somehow, reduce NPAs & under-performing assets - and shore up reserves.