A Study On The Relationship Between Financial Innovation And Bank Sustainability- A Case Study Of State Bank Of India

Abstract

This study looks at the various forms of financial innovations that have continuously taken place in the provision of financial products /services in India over a period of 5 years. Over a period of time, India has experienced continued growth in the adoption of various non-cash modes of payment hence the need for continuous studies to establish the effect of these financial innovations in the financial services sector. Previously banks were interested only in the economic impacts of the banks but banks are now conscious of the environmental and social impact of their policies as it might affect the quality of assets and also rate of return of banks in the long run. The objective of this study was to establish the effect of financial innovation on bank sustainability. The present study is descriptive as well as analytical in nature. The State Bank of India has been selected for study deliberately being the largest commercial banks in India having wide coverage spreading throughout the country. The data, for the purpose of study, were collected from the annual reports of SBI, Bank Sustainability Report of SBI, journals and other relevant published documents. The study was conducted for a period of 5 years, from 2015-16 to 2019-2020. The analysis of data leads to the conclusion that financial innovation has increased over the period of time. However financial innovation has less impact on bank sustainability in Indian banking sector.