INNOVATIVE BUSINESS MODELS: A STUDY WITH REFERENCE TO INDIAN BANKING SECTOR

The Indian Banking Industry has been witnessing a huge reformation in the last two decades. The commencement of financial sector reforms has led to the intensification of the Indian Banking sector and has made it more and more competitive. Banks in India are changing the way they do business. There has been a significant change in customer expectation withregard to banking services. Banks have started altering their business model by emphasising more on provision of better customer experience rather than on mere selling of products. The increasing use of technology in banking process has led to the availability of core banking solutions, internet banking credit and debit cards, mobile banking etc. This transition to the new business environment has created newer demands on the banking sector such as increased workflow and customer access to banking transactions through the electronic mode. Most banks in India are working towards providing customised products that meet the requirements of their diverse clientele The financial products offered by banks are much more when compared to non-banking companies and therefore the need to develop customer centric products assumes paramount significance in an era of heightened competition. The banking sector in India is no exception to this growing trend of staying ahead in the race to retain customers through their innovative practices. Indian banks are aspiring high and are moving towards implementing a world class internet banking capability. The presence of a large unbanked population provides the scope for innovation in delivery. Banks in India have started leveraging the use of technology to achieve competitive advantage by reaching out to masses in a cost-effective manner. The use of technology providing services to a customer segment with differentiated needs and creating value through it has become a noticeable trend in the Indian banking system. Digital banking seems to be a preferred choice among the new generation banking customers. They are moving towards building a digital business model. The present research paper is an attempt to provide an insight into the changes witnessed in the banking business model in India.