Comparative Study of the Efficiency of Old and New Private Sector Banks Based on the DEA Approach

Abstract

It is commonly known that the rise of banking systems promotes economic expansion. Distribution and keeping of liquid capital are the main functions of banks. It channelizes funds from the surplus sector to the deficit sector for this reason; banks need to be financially stable. This study aims to evaluate the technological effectiveness of Indian banking. The current study spans five years, from 2017 to 2021, in its scope the first step in investigate the technical efficiency of selected old private sector banks and new private sector banks based on CRS and VRS using Data envelopment analysis .and in the second step is study try to understand the difference the which type of banks is more efficient. A total of 16 banks are considered in this study technical efficiency under the CCR (Charnes cooper Rhodes) model of old private sector banks is found 95.8 % and for new private sector banks, it is 96.20%. technical efficiency under BCC is found under old private sector banks is 97.4 and for new private sector banks it is 98.3% technical efficiency under scale efficiency is observed at 98.3 % which is observed the same for both types of banks. This study indicated that there is no significant difference in the efficiency of old private sector banks and old private sector banks under CRS, VRS, and SCE.