Fifteen years after India began unshackling private enterprise as part of economic liberalisation, the remarkable resurgence in the country’s private banks is visible on city streets. In most large cities, crowds throng at cash machines in railway stations, airports and shopping centres; banks routinely offer internet banking services and the telemarketing of credit cards and loans is threatening to become a public nuisance.
Behind the marketing blitz are savvy private Indian banks that have excelled in using the latest technology in providing customers with modern products at competitive prices. They have around a tenth of the 69,000 bank branches in the country, but a market share of 20% of total bank assets. They manage more than 7659 cash machines, more than nine times the number foreign banks run. Unsurprisingly, while the private banks have surged ahead, the market share of the giant public sector banks in total bank assets is falling – at 72% now – while that of foreign banks hovers around 7%.
