Challenges Of Retailing And India

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CHALLENGES OF RETAILING BANKING IN INDIA:
1. "Generation Next" segment: (426 million young Indian between age group of 15-34 years see life and life-style very differently)- This is going to be the target in immediate future. It is currently urban phenomenon but it would not be too long when it will emerge in rural India also. They are tech-savvy and prefer electronic channel. They seek financial information from variety of sources and are very fickle shoppers. Banks will have to leverage technology and develop E-based products to tap this segment
2. "Rural segment" is one from where fresh demand of retail loan is being generated. PSBsare in real advantage as they have good network of rural and semi-branches where competition is less and opportunities are more.
3. Cross selling and up selling : is a very successful way of improving volumes. As a strategy existing customers should be offered products where profit margins are more e.g. offering car loan, furnishing loan etc. to existing housing loan customers. Further based on contribution of the customers to bank, differential-pricing strategies such as discount in interest, as relation ship waiver has to be evolved.
4. Housing loan has large potential -: House today is better affordable through loan. Tax breaks have spurred credit demand. RBI move to cover home loan up to Rs. 20 lakhs under priority sector has made the banks to push harder the home loan product. The SARFAESI Act has increased level of comfort as bank
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