The financial sector of the Indian economy has undergone several reforms after independence, geared towards increasing productivity, efficient use of available resources and policy changes opening the economy up to foreign investments. All these measures taken together combined to make India’s economy an especially vibrant one, considered by many to be well regulated and resilient, even in the face of global economic downturn.
80% of the market share in this sector is held by State owned/managed Banks, leaving only a small amount to be fought over by private individuals, increasing competition in this field. The banks have an even more important role to play in India in comparison to most other countries as they are responsible for subsidizing costs for consumers, and the decisions of the RBI to increase or decrease interest rates directly affects the investment potential of all sectors.
The banking sector includes under it the segments of life insurance and health insurance, which have been growing at a steady pace for a number of years. The Banking and Financial services industry is also a major contributor to employment and is expected to increase its workforce by about 15-20 Lacs in the coming decade.
The Banking industry is also facing a host of challenges with the modernization of the sector. The risk posed to peoples wealth by hackers, ignorance of consumers as to how e banking works and of financial exclusion all seem daunting challenges, but the evolving strategies adopted by Banks and other Institutions in this sector have proved to be sufficient to match the needs of the day and continuing innovation in the field will help maintain this trend.
The growth of the GDP of the country is expected to make the Indian Banking Industry the third largest in the world by 2025. However, in order to maintain the current rate of growth and meet expectations it is necessary for banks to change their regulatory structure and adapt their strategy to best meet the needs of the constantly changing landscape.
Our extensive experience in dealing with law relating to all possible aspects of Banking and its associated fields enable us to provide our Clients with top class legal advice and representation whenever needed.