Effectiveness of Automated Customer Centric Banking Services on Profitability and Performance of Indian Commercial Banks

Abstract

The banking sector plays a very vital role in the economic development and growth of a country. The effective and efficient banking sector is thus the fundamental requirement for smooth functioning of any economy. In the present study an attempt has been made to assess the technical efficiency and performance of Indian Banking Sector. This study uses DEA approach to estimate the technical efficiency of commercial banks in India over the years 2009-2014. Data Envelopment Analysis (DEA) is widely used in banking sector to measure the efficiency and performance of the banks. The study is based on top 24 Indian commercial banks (6 public, 6 new private, 6 old private and 6 from foreign sector banks). The results of the study indicated that old private sector banks and foreign sector banks were found more efficient than new private sector banks, whereas new private sector banks did not use their IT inputs well. In consideration of scale inefficiency analyzed that foreign sector banks have done well in the field of using their input efficiently than other banks.