Indian Banking Industry Research Articles

Loopholes in the Indian Banking System concerning Non-Performing Assets (NPAs) – A Case Study of “Axis Bank and HDFC Bank”

Abstract -The paper presents a comparative case analysis of two leading banks, Axis Bank and HDFC Bank. The rising tide of Non-Performing Assets (NPAs) in the banking sector is a major threat to financial stability and economic progress. The case study uncovered severe deficiencies in risk management, credit evaluation, and regulatory compliance, which have resulted in a considerable accumulation of Non-Performing Assets. The banks' exposure to economically sensitive sectors amplifies the impact of downturns on asset quality. The limitations in credit risk assessment underline the necessity for increased due diligence. Regulatory frameworks, such as the Insolvency and Bankruptcy Code, and prompt corrective action have a significant impact on NPA responses. The findings highlight the complicated interplay between internal banking practices, regulatory frameworks, and economic conditions that affect a bank's financial performance. Addressing discovered weaknesses inside both these banks is important to the stability of India's financial system. The implications, as indicated by rising NPAs, are felt throughout the sector, jeopardizing overall resilience. Addressing these problems is crucial for reducing systemic risks, preventing a credit crisis, and rebuilding trust in the financial industry. A better banking system is critical for India's financial stability, economic growth, and stakeholder trust. As major private sector players, Axis Bank and HDFC Bank’s successful remediation set a precedent, emphasizing the need for excellent risk management, regulatory compliance, and strategic adaptation. Key Words: Axis Bank, HDFC Bank, Non-Performing Assets, Risk Management, Regulatory Compliance, Financial Stability, Economic Impact

Loopholes in the Indian Banking System concerning Non-Performing Assets (NPAs) – A Case Study of “Axis Bank and HDFC Bank”

This paper presents the development and implementation of an innovative IoT-based Surveillance Robot designed for remote control, utilizing a Wi-Fi module and a smartphone interface. The portable espionage robot integrates cutting-edge technology, featuring an AI Thinker ESP32-CAM module with an ESP32-S processor, an OV2640 camera, motor drivers, and a robust chassis with two moving wheels. The ESP32-CAM allows the capture and storage of images on a microSD card, facilitating efficient data management. The robot employs the HTTP Communication protocol, enabling users to access live video streaming from the OV2640 camera through a standard web browser. The web interface includes intuitive directional buttons for seamless control, allowing users to command the robot to move left, right, forward, and backward. The locomotion of the robot is achieved through two DC motors integrated with a Robot chassis and an L293D motor driver module. The real-time video feed is transmitted wirelessly to the user's smartphone over a Wi-Fi infrastructure, providing a live- streaming experience. This wireless surveillance robot finds applications in various scenarios such as war fields, disaster management, and beyond, showcasing its versatility in remote monitoring and reconnaissance tasks. Keywords: IoT, Surveillance Robot, Wireless Control, ESP32- CAM, HTTP Communication, Video Streaming, Smartphone Control, Disaster Management, Robotics, Remote Monitoring, Reconnaissance.

The Role of Customer Satisfaction and Awareness as A Measure of Customer Loyalty- A Study on Select Banks

Purpose: The study wants to examine customer loyalty through customer satisfaction and awareness using developed constructs for select Nifty Banks. Theoretical framework: The theoretical framework for the study is to analyze customer loyalty through customer satisfaction and awareness using constructs of General Services (GS), Product Cognizance (PC), Technology Services (TS), and Social Responsibility (SR). Design/methodology/approach: The cluster sampling method was used to collect data from bank customers (n=360) using the self-administered questionnaire. The research used Partial Least Squares – Structural Equation Modelling (PLS-SEM) to test the hypothesis using SmartPLS 4. Findings: The result showed, that there is low customer satisfaction with Technology Services (TS) and that hypothesis was rejected. Research, Practical & Social implications: The study has provided recommendations for banks were discussed to pay more attention to customer fulfilment and awareness which convert satisfaction to customer delight. Originality/value: Due to market sustainability and dynamics, the Indian banking industry has undergone many major changes such as digital banking units (DBU), digital currencies, and social green initiatives. Bank has incorporated many advancements to overcome its rivals. So, the study wants to know the customers are aware of these changes among their banks and whether they are satisfied with products and services. Contribution/Originality: The study wants to rank the select banks of India based on the constructs built, which measure customer loyalty through customer satisfaction and awareness.

Unraveling the Essence of Cybersecurity in Banking: Preserving Financial Integrity and Building Confidence

There are more plastic cards in the wallet than currency notes. This change is because the Indian banking industry, is going through an IT revolution to be competitive with the other developed and developing nations and other regulatory reason has led to total banking automation in the Indian Banking Industry. According to KPMG-CII report, India has the capability to become the third largest by 2025 and fifth largest in the world by 2020 in the banking industry. Also, India’s banking industry is worth Rs. 81 trillion and it is utilising latest internet infrastructure to be competitive to other economies. The Indian banking system consists of 26 public sector banks, 20 private sector banks, and 43 foreign banks, together with 61 regional rural banks (RRBs) and over 90,000 credit cooperatives. The change towards internet banking is intensified by the changing dynamics in India as it is about to become one of the youngest countries in the world by 2020, the average age being 29 years. And this young population is technology savvy and wants real time online information. As the users of the online banking will increase rapidly in the years to come, these systems are becoming the most likely targets of hackers and cyber criminals. Banking institutions must take all measures to make online banking system safe, to maintain the customer trust and satisfaction level for online banking. To be protected by the cyber security threat banking institutions will have to develop effective and efficient customer awareness programs as safety from cyber threats related to bank are equally interdependent 2024on the level of awareness of using the banking online system and does not solely depend on the safeguards and practices implemented by the bank. This makes it very difficult for banking institutions to maintain the confidentiality and integrity of the banking system. The research will try to assess whether there is awareness of threats of online banking among the users that comprise online banking and to further analyse whether there is a difference in awareness of the users on the basis of Age and Gender.

Exploring Bankers' Perceptions of the Effectiveness of Red Flags in Fraud Detection: Evidence from Indian Banking Industry

Exploring Bankers' Perceptions of the Effectiveness of Red Flags in Fraud Detection: Evidence from Indian Banking Industry

Work-Life Balance of Women Employees in the Indian Banking Industry: An Empirical Study of the State of Haryana

A fulfilling existence is possible when one’s work and personal life are in harmony with one another. Finding a happy medium between one’s “work” (career goals) and one’s “life” (personal happiness, leisure activities, family, and spiritual growth) is what the phrase “work-life balance” (WLB) is all about. Today, women’s work-life balance (WLB) is more important than ever before because of the societal expectation that men and women should provide financially for their families (Doble & Supriya, 2010). This highlights the critical need for studies examining women’s WLB. Finding out what factors most affect women’s WLB is the primary objective of this study. 310 bank employees had their personal information gathered. Some exploratory methods that were used to evaluate the data were path analysis, structural equation modelling, factor analysis, and correlation. There was a strong correlation between workload, organisational support, and family support, as well as WLB. Companies can use this kind of information to zero in on the exact variables that increase WLB.

Zombie-lending during the pandemic in India: Did the Central Bank reduce credit misallocation concerns of forbearance?

During the COVID-19 pandemic, the Reserve Bank of India (RBI) undertook a policy mix approach to maintain financial stability in the Indian banking system. RBI recapitalized the banks and infused liquidity through accommodative monetary policies combined with temporary forbearance policies of restructuring loans to boost credit growth and support economic expansion. With a focus on zombie lending, we examine the effectiveness of this policy mix in bank lending channels during the pandemic. We find banks have extended credit growth to the non-financial listed firms. Broadly, we obtain little evidence of credit misallocation to these firms through zombie lending. Subsequently, we observe a decline in zombie lending to manufacturing and small and medium enterprises. However, our result shows a significant increase in zombie lending towards high rent-seeking industries. We witness that zombie lending does not crowd out healthy lending through the bank and industry congestion channels. The results of our study have significant implications for policymakers. Specifically, our findings suggest that accommodative monetary policy reduces credit misallocation concerns of forbearance. In the absence of monetary policy support, forbearance alone may exacerbate adverse effects.

Bank performance evaluation of sustainability strategy dimensions in the emerging market using the MCDM approach

Increased public awareness about the environmental and social impact of the businesses has led to the integration of sustainability into the core business activities. The banking sector, being one of the major drivers of the economy, is also focusing on social and environmental performance along with generating financial returns. The purpose of this paper is to evaluate the sustainability performance of Indian banks using grey relational analysis (GRA). This study uses three criteria to evaluate the bank’s sustainability performance, which include economic, environmental, and social. Grey relational grades are obtained for ranking the banks according to their sustainability performance. The novelty of the study lies in the fact that this study is the first attempt to evaluate the sustainability performance of Indian banks using the GRA methodology. This study has practical implications for the Indian banking industry, which could encourage managers to formulate policies and strategies for adopting environmental and social parameters in their operations to improve their overall performance. The study results could also influence investors to invest in banks seeking sustainability in their operations as the country progresses towards sustainable development.

Soulful Workplace: Unveiling the Spiritual Dimensions of Indian Banking Industry

Soulful Workplace: Unveiling the Spiritual Dimensions of Indian Banking Industry

Efficiency of Commercial Banks in India during Pre and Post E-Banking Period

Banking industry being the knowledge-intensive industry plays an important role in enhancing economic growth of the country. In this whimsical world of technology where Indian Commercial banks are facing intense competition both from domestic as well as international players, the working of this industry have changed drastically with the onset of e-banking period. Such technology-banking or e-banking era is a stimulant to enhance not only economic growth of the country but also efficiency of banks. In this context, this paper is an attempt to study the efficiency of commercial banks in India during pre and post banking period. Also, this study suggests policy recommendations for Indian banking industry to cope the inefficiency and face the competition boldly.

An Empirical Analysis of Non-Performing Asset in Selected Banks of India

The profitability of the Indian banking industry is directly impacted by the non-performing assets. It is one of the main issues facing India's banking sector. The execution of several committees' recommendations and the government of India's ongoing attempts have had a favourable influence on the economy by lowering the NPA of the Indian banking sector. Due to strategic planning by the Reserve Bank of India and the finance departments, it began gradually decreasing as a percentage of net advances after 2018. The purpose of this paper is to evaluate the effects of NPA on bank profitability and the techniques used by banks to reduce NPA. The study is based on secondary data that was collected from a variety of bank audited reports, yearly reports from the RBI, websites, etc. It has been determined that the NPA is gradually shifting into a declining mode following the adoption of RBI directives and modification of NPA management strategy.

A Comparative Study of Options with Reference to ICICI Bank, SBI and Axis Bank

Options trading is a dynamic and sophisticated field that shapes investment strategies for big banking organizations in the complex world of financial markets. With a focus on three major participants in the Indian banking industry—ICICI Bank, State Bank of India (SBI), and Axis Bank—this study conducts a thorough comparative analysis. The study aims to dissect and compare the complex tactics, positions in the market, and general performance of these banks in the field of options trading. It provides a thorough analysis of market positioning and competitiveness as well as deep insights into the complex strategies used by each bank. Additionally, it looks to pinpoint the crucial elements of success as well as the difficulties these financial organizations face in the intricate world of options trading. Insightful comparative studies, the discovery of original tactics, an assessment of market positioning, and comprehensive insights into the elements determining success or difficulties faced by ICICI Bank, SBI, and Axis Bank in the ever-changing world of options trading are among the anticipated results. For investors, financial analysts, and regulators who want to understand the intricacies of options trading in the banking industry, this might be a useful tool.

Cash to Cashless Economy: Opportunities & Challenges in India

Cash may be defined as the legal common way for all kinds of material transactions in an economy. In a highly unorganized economy, the circulation of currency notes without disclosing of its actual income to appropriate authorities provides enough scope for the accumulation of black money in the hands of people as well as the circulation of duplicate currency notes. So, it is necessary to promote digital transaction & plastic money in order to track all the payments and income sources of people. Cash use doesn't seem to be waning all that much, with around 85% of global payments still made using cash. the main reasons are that there is nothing to truly compete with the flexibility of notes and coins. Indian governments also inclined to transform the Indian banking system from traditional branch-based practices to technology-driven cashless banking. And for this it provides enough opportunities such as increasing mobile & internet penetration, raising disposable income, ensuring various lifestyle, urbanization, increasing foreign investment and latest economic and taxation reforms, etc. to accelerate digital transactions but we have to encounter a number of challenges also like poor internet connectivity in rural areas, digital literacy, cybersecurity issues, highly fragmented unorganized economy, etc. Now we can conclude that we have initiated such measures which will pave the way for such a digital transformation of the Indian economy.

Does inflation expectation affect banks' performances? Evidence from Indian banking sector

PurposeThe study intends to evaluate the impact of inflation expectation on the performance of listed commercial banks in India during 2005–2021. Inflation expectation is considered as a direct policy tool by the policymakers for stability of the economy. The study explores how inflation expectation affects the performance indicators of the Indian banking industry while controlling for a wide range of bank-specific factors.Design/methodology/approachThe study applies the generalized method of moments (GMM) on a panel sample of 27 listed bank to analyse the impact of inflation expectation on banking sector performance. The data on inflation expectation are obtained from the household inflation expectation survey introduced in India by the Reserve Bank of India in 2005. Return on assets (ROA), return on equity (ROE) and Tobin's Q have been considered as the banking performance indicators in this study.FindingsEmpirical results exhibit that inflation expectation is instrumental in deciding the banking sector's performance. Inflation expectation has been found to have a significant and positive impact on accounting-based measures of banking performance. At the same time, it shows negative impact on the marketing-based measure.Practical implicationsThe study gives a clear picture about how inflation expectation affects the banking performance and the monetary policy of the country. The study provides crucial insights to develop strategic decisions for the Indian banking sector. The adoption of proper macroeconomic policies, taking into account inflation expectation levels, is instrumental in enhancing bank's performance and in achieving economic growth.Originality/valueThis study contributes to the growing body of literature on the impact of inflationary conditions on banking performance. The originality lies in capturing the role of inflation expectation solely in determining banking sector performance.

Strategic sustainability in Indian banking industry: a performance analysis

PurposeSustainable strategic management (SSM) is an integrated concept that entails sustainability in the approaches and processes of strategic management. Banking being a rapidly growing industry in service sector, it is reasonably important to study the SSM and its integrated performance. This paper aims to study the sustainable-strategic (SS) factors of Indian banks that affects their endurance and prioritizes the banks based on their sustainable and strategic performance.Design/methodology/approachThis study appertains a sustainable balanced scorecard (SBSC) framework to determine the SS factors and an integrated multicriteria decision making (MCDM) method to weigh the criteria and prioritize the banks' performance.FindingsThe criterion weightage signifies sustainability, followed by financial and internal business perspective to be a crucial dimension for the performance of banks. The banks, State Bank of India, HDFC Bank Ltd and Canara Bank are ranked top-most on the SS performance.Research limitations/implicationsThe insights from the study on SS factors and banks' performance can be further used by policy-makers and researchers to understand the sustainability assessing factors and focus on making policies and further studies to enhance the performance in this regard.Originality/valueBanking is one of the potentially growing industry in service sector. It being a major part of economy's sustainable growth, it is essential to assess the SS factors that enhance their sustainable performance. There is dearth of study in this purview, for developing countries like India. Thus, this study critically analyses the strategic sustainability of Indian banking industry to ascertain the SS factors and prioritize the performance of banks based on criterion weightage and bank's SS operations.

Indian Banking Industry: Challenges and Opportunities

Traditional banking practices from the British era, through the reforms era, nationalization, privatization, and the rise of an ever-increasing number of international banks in India, all comprise a vast canvas that makes up India's banking industry's history. Thus, the development of banking in India has been a protracted process. Keeping pace with the trends, India's banking sector has also reached new heights. Banks' methods of operation have undergone a dramatic transformation as a result of technological advancements. The danger of a lack of work-life balance is particularly evident in the banking sector. When it comes to satisfying their clients' varying requirements, bank employees exert tremendous effort. Tightening deadlines and increased workloads mean that workers must prioritise the quality of their product. It's challenging to strike a balance between work and personal life in today's fast-paced, always-on society. Human resource quality directly impacts the success of the banking industry.

Determinants of income diversification: empirical evidence from Indian banks

PurposeThis study aims to explore the determinants (bank-specific, industry-specific and macroeconomic) of income diversification across interest income and non-interest income as well as for non-traditional income sources (non-interest income) from 2004–2005 to 2021–2022.Design/methodology/approachAn unbalanced data set comprising 110 Indian commercial banks with 1480 observations is sampled in this study. Because of the bounded nature of the dependent variables (proxies of income diversification), the panel Tobit regression model is used.FindingsThe findings reveal that income diversification is positively influenced by bank size, technological advancements, cost–income ratio, return on assets, market competition and inflation in the economy. However, the decision to diversify income sources is adversely impacted by the capital ratio, GDP and financial intermediation ratio. Moreover, factors such as asset quality (loan loss provisions) and liquidity ratio do not directly influence the diversification strategies in the Indian banking industry.Practical implicationsThe present study uses an extensive set of variables to provide insights into key factors for bank managers, regulators and policymakers to consider before developing diversification strategies.Originality/valueTo the best of the authors’ knowledge, this is the first study to examine the various bank-specific and macroeconomic determinants that affect income diversification in the Indian banking sector. The current study also investigates new variables such as technological advancements and a market concentration index for measuring competition, which have not been investigated in existing literature concerning bank income diversification in the Indian context.

Impact of Human Resource Management Practices on Organizational Performance: Evidence From the Indian Banking Industry

This study is an endeavour to assess the impact of different human resource management practices on the organizational performance of banks in India. Using a convenience sampling technique, a sample of 325 employees from four banks responded to a survey questionnaire. The psychometric properties of the constructs were established through confirmatory factor analysis, while structural equation modelling was utilized to examine the proposed hypotheses. The findings of the study confirmed a positive and significant influence of training and development, performance appraisal, and employee involvement on the performance of the banks under investigation. However, recruitment and selection indicated a positive but insignificant impact. The outcome of this research can assist policy and decision-makers in enhancing organizational performance by investing in appropriate human resource management practices. The study is equally significant for human resource professionals and practitioners to foster the professional development and advancement of their personnel.

Digital Financial Services (DFS) and Productivity of Indian Banking Sector - Empirical Evidence Using Malmquist Productivity Index and Panel Data Regression

Purpose: The aim of this study is to examine the impact of Digital Financial Services (DFS) on the productivity of banking sector in India.
 
 Theoretical framework: This research considered various digital banking services offered by bank and how it affects the actual bank performance in terms of productivity, by adopting a two-stage model i.e., Malmquist Productivity Index (MPI) and panel data regression.
 
 Design/Methodology/Approach: The empirical study was based on eight-year balanced panel data from 2012 to 2020. The sample of the study consists of forty-four commercial banks from India. This study is completely based on secondary data collected from the website of the database of the Indian economy and the National Payment Corporation of India (NPCI). To achieve the research goals, a two-stage approach has been used. Initially, Malmquist Productivity Index (MPI) was employed to estimate the total factor productivity changes. In the second phase, panel regression analyses were used to study the impact of Digital Financial Services (DFS) on bank productivity.
 
 Findings: The findings show that the Digital Financial Services (DFS) variables such as mobile banking, online banking, Automatic Teller Machines (ATM) and Point of Sale (POS) transactions are significantly improved the productivity of the Indian banking industry.
 
 Research, Practical & Social implications: The study addresses the issues such as identifications of factors affecting the productivity of banks including Digital Financial Services (DFS). In the world of digital revolution, it analyses whether bank can retain, continue and enhance their performance by offering modern product and services to their customers.
 
 Originality/Value: This article has conducted extensive analyses of Digital Financial Services (DFS) and banks' productivity. The authors also provide suggestions for the policymakers for the future implementation of digital banking services.

Prioritizing the attributes of sustainable banking performance

PurposeGrowing concern over sustainability adoption has presented an array of challenges to businesses. While vital to an economy's success, banking is not immune to societal, environmental and economic consequences of business practices. The study has examined the sustainable performance of banking institutions on the suggested multidimensional framework comprising economic, environmental, social, governance and financial dimensions and 52 sustainability indicators. The study benchmarks the significant performance indicators of leading banks indispensable to sustainable banking performance. The findings attempt to address research questions concerning the extent of sustainable banking performance, ranking the sustainability dimensions and indicators and standardizing sustainability adoption metrics.Design/methodology/approachTo determine the responsiveness of the banking industry to sustainability dimensions, content analysis was conducted using NVivo software for the year 2021–2022. Furthermore, a hybrid multicriteria decision-making (MCDM) approach is used by integrating entropy, the technique for order preference by similarity to ideal solution (TOPSIS) and VlseKriterijumska Optimizacija KOmpromisno Resenje (VIKOR) to provide relative weights to performance indicators and prioritize banks based on their sustainable performance. Sensitivity analysis is used to ensure the robustness of results.FindingsIn the context of the Indian banking industry, the pattern of sustainability reporting is inconsistent and concentrated on addressing environmental and social concerns. The results of the entropy methodology prioritized “Environmental” sustainability over other selected dimensions while “Financial” dimension has been assigned the least priority in the ranking order. The significant sustainable performance indicators delineated in this study should be used as standards to ensure the accountability and credibility of the sustainable banking industry. Additionally, the research findings will provide valuable inputs to policymakers and regulators to assure better contribution of the banking sector in meeting sustainability goals.Originality/valueConsidering the paucity of studies on sustainable banking performance, this study makes two significant contributions to the literature. First, the suggested multidimensional disclosure model integrating financial and nonfinancial indicators would facilitate banking institutions in addressing the five aspects of sustainability. As one of the first studies in the context of the Indian banking industry, the findings would pave the way for better diffusion of sustainability practices. Second, the inclusion of MCDM techniques prioritizes the significance of sustainability indicators and benchmarks the performance of leading banks to achieve better profits and more substantial growth.