The entry barriers to traditional Banks have been disrupted with
new specialized entrants and emerging business models which have
blurred the lines between business and technology. The traditional
approach to creating value in Banking through growth and efficiency
and advantages realized through acquisition, new markets and
product offerings will likely be short lived. A Bank's ability
to manifest opportunities out of the disruptive environment based
on Technology and external partnerships to create customer value
will determine its success in the future.
With several new players entering the banking scene, the sector
is set to witness unprecedented changes in the times to come. The
Financial Inclusion agenda has led to several types of banking
models–small banks, payment banks, and on tap license for new
banks. The agenda has also taken a step forward to include new
non-bank players in the Fintech space who are vying to grab a
larger share of the Banking value chain. While, on the one hand,
this allows last mile connectivity and lowering of cost to the end
customer, it causes huge disruption in the banking environment,
possibly leading to a realignment of players in the market as we
look ahead to the year 2020.
"Banking on the future : Vision 2020" select key
changes that banks need to make in their go-to market approach,
starting with shortening their strategy cycles to months instead of
years, getting better at reading signals of change in this
disruptive environment, and becoming tactically focused on being
operationally lean and agile in response to market conditions. This
will result in choices being made to adopt or partner with fintech
businesses offering digital interactions and to accept that there
are alternatives to core legacy IT systems offering greater speed
to revenue generation, effective operations and better customer
experience. Technology has democratized businesses by creating
access across all levels and by creating a level playing field.
This Report provides a broad view of the shape of things to come
by focusing on Payment Banks as a model and on Mergers &
Acquisitions as a route to consolidation and growth. The report
emphasizes the role of Technology and touches upon Cognitive and
Artificial Intelligence, Robotics Process Automation, Block chain
and Fintech as emerging areas.
In the backdrop of tardy judicial recovery mechanism relating to bad loans in India, the Government of India initiated corrective measures by endeavouring to change the existing legal provisions to circumvent such menace.
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