Technological Change, Financial Innovation, and Diffusion in Indian Banking Sector – A Move towards the Next Orbit

Abstract

The revolutionary impact brought in banking sector through technological advancement is irresistible. The effective use of technology has a multiplier effect on growth and development. Technology has enabled the banks to conceive deliver, manage and integrate their products in line with the customers' need. It has helped banks to reach the doorsteps of the customer by overcoming the limitations on geographical/ physical reach in branch banking and easing the resource and volume constraints posed by the brick and mortar model Technology enables increased penetration of the banking system, increases cost effectiveness and makes small value transactions viable. Besides making banking products and services affordable and accessible, it simultaneously ensures viability and profitability of providers. It allows transactions to take place faster and offers unparallel convenience through various delivery channels. Technology enhances choices, creates new markets, and improves productivity and efficiency. The Indian banking business is also not untouched by these technological innovations. These, technology, as the differentiator has become the driver of the Indian banking business since the past decade with the financial sector reforms providing firm foundation