The next Big War in Indian Banking


interest_Fotor

Dr. Raghuram G. Rajan, RBI Governor, in the Second Quarter Review of Monetary Policy 2013-14, unveiled a very bank customer friendly initiative.

Commercial Banks have been given the option to pay interest on savings deposits and term deposits at intervals shorter than quarterly intervals.

Till today, banks were required to pay interest on savings deposits and term deposits at quarterly or longer intervals.

The chief guiding for such a customer friendly initiative is the fact that all commercial banks are on CBS (Core Banking Solution), which makes interest calculation an automated activity.

The Banks CBS should be able to carry out the modified interest calculation activity without much tweaking.

The challenge would be for Banks to decide the periodicity of payment of interest, and to convey to customers, that their option is the best in the market.

Look out for innovative banking products in the near future.

Personally, I prefer to receive interest at longer intervals, rather than shorter intervals. What is your opinion?

One thought on “The next Big War in Indian Banking”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s