Publication Date: 2023/08/01
Abstract: The Indian banking and financial system have come a long way since its early days. As of 2022, the total assets across all banking sectors (public and private banking) crossed $2.67 trillion. India has one of the world's largest retail banking and financial services institutions - with 12 public sector banks, 22 private banks, 46 foreign banks, 56 regional rural banks, 1485 urban cooperative banks, and 96000+ rural cooperative banks, along with other credit institutions. The banking industry is undergoing a radical shift, one driven by new competition from FinTechs, changing business models, mounting regulation and compliance pressures, and disruptive technologies. The emergence of FinTech/non-bank startups is changing the competitive landscape in financial services, forcing traditional institutions to rethink the way they do business. As data breaches become prevalent and privacy concerns intensify, regulatory and compliance requirements become more restrictive as a result. And, if all of that wasn’t enough, customer demands are evolving as consumers seek round-the-clock personalized service. Banking sector of India is one of the fastest growing sectors and helps in sustaining economic growth of the country. The banks are the lifeline of our economy and play a crucial role in the development of the country. In the present scenario banks are facing lots of challenges because of inflation, denominations of currency notes, frequently changing bank rates policy and because of these challenges there is an adverse effect on the growth of the banks as well as on the growth of the country. The economic reforms have also produced a new and efficient customer who belongs to middle class and new mix of players like public sector units, private banks, and foreign bank. The emerging competition has generated new expectations from the existing and the new customers. The biggest opportunity of the Indian banking system today is the generation of new consumers and also to motivate them to invest their money in banking system in the form of Small Investment Plan(SIP), Recurring deposit, Fixed deposits, Mutual funds etc. But because of upcoming challenges the banking system is like, has been stopped as no new customer are generated and the long standing customers are also pulling their hands back from the investment previously done. The basic objective behind writing this paper is to study the challenges being faced by the banking sector of India like decrease in the deposits but increase in the withdrawals which results in the decrease of money in the banks and in the economy.
Keywords: Deposits and withdrawals, Economy and Lifestyle.
DOI: https://doi.org/10.5281/zenodo.8204230
PDF: https://ijirst.demo4.arinfotech.co/assets/upload/files/IJISRT23JUN1392.pdf
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