Young ones queuing up at swanky ATMs to take out cash or using Internet for banking are signs of growing influence of technology on the domestic banking sector.
Is it a sure sign of the increasing liking of retail banking customers for automated interface sans personal touch? An emphatic 'no' is the answer, if results of a recent survey by global strategy firm McKinsey & Company are any indication.
The preference for personalised services has actually grown strong. About 75 per cent of the about 300 Indians who participated in the survey of urban banking consumers favoured individual contact over the impersonal rapport with ATMs. This is as opposed to a lesser 55 per cent respondents preferring personalised banking in a similar survey conducted in 1999.
Indian customers still look forward to visiting a bank branch and dealing with a person whom they know. One area that could be an apt example for personalised service is wealth-management.
The domestic retail banking market is expanding rapidly, with total annual revenues expected to more than double, to $16.5 billion by 2010 from about $6.4 billion today.
When it comes to wealth management, only 10 per cent of the respondents said they availed of the services of a financial adviser. Yet more than half of the respondents said they would like more assistance in managing their investments. However, very few banks currently offer it, thus leaving the market to tax advisers and accountants.
All respondents, evenly distributed between affluent and less affluent households, in the survey expressed loyalty to domestic banks. About 69 per cent said they would stay with their current bank, even if competitors offered lower fees and higher interest rates.
Younger and relatively affluent Indian consumers view the entry of foreign banks as advantageous. An increasing number of banking customers in India value the skills and portfolios of products offered by multinational banks.
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