What are the top 10 banking trends?

RBI’s credit policy for the first half has underlined the need to accelerate credit flow to productive sectors, particularly to agriculture and small scale industries. Though there has been significant increase in the total volume of credit flowing to these sectors, sanctioning credit to these sectors is perceived to be too complex and time-consuming. Banks have therefore been advised by the RBI to implement the recommendations made by the one-man committee under the Chairmanship of Shri R.V.Gupta in regard to several procedural modifications on agricultural credit. Banks have been advised to delegate sufficient powers to their branch managers. To facilitate quicker submission of application for and delivery of loan, the Indian Banks Association has been requested to frame simpler application forms for agricultural loans.

At the beginning of the 21st century, the biggest banks in the industrial world have become complex financial organizations that offer a wide variety of services to international markets and control billions of dollars in cash and assets. Supported by the latest technology, banks are working to identify new business niches, to develop customized services, to implement innovative strategies and to capture new market opportunities. With further globalization, consolidation, deregulation and diversification of the financial industry, the banking sector will become even more complex.

Although, the banking industry does not operate in the same manner all over the world, most bankers think about corporate clients in terms of the following:

• Commercial banking - banking that covers services such as cash management (money transfers, payroll services, bank reconcilement), credit services (asset-based financing, lines of credits, commercial loans or commercial real estate loans), deposit services (checking or savings account services) and foreign exchange;
• Investment banking - banking that covers an array of services from asset securitization, coverage of mergers, acquisitions and corporate restructuring to securities underwriting, equity private placements and placements of debt securities with institutional investors.

Over the past decade there has been an increasing convergence between the activities of investment and commercial banks, because of the deregulation of the financial sector. Today, some investment and commercial banking institutions compete directly in money market operations, private placements, project finance, bonds underwriting and financial advisory work.

Furthermore, the modern banking industry has brought greater business diversification. Some banks in the industrialized world are entering into investments, underwriting of securities, portfolio management and the insurance businesses. Taken together, these changes have made banks an even more important entity in the global business community.

Spread out your risk. You should not put all your money in high risk stocks. Try some lower risks and some higher risks. This is the best way to protect your money.

IN ADDITION TO VARIOUS CHANGES MENTIONED BY FELLOW MEMBERS THERE IS A SEA CHANGE IN THE BANKING SYSTEM.CONTRARY TO THE YESTERYEARS` TREND OF VERY SMALL %  OF PEOPLE USING BANKS, A VERY GOOD % OF PEOPLE HAVE STARTED USING BANKS FOR VARIOUS PURPOSES,BANKS HAVE STARTED COMING CLOSER TO THE CUSTOMERS,ARE ON THE LOOK OUT FOR RELIABLE AND WORTHY CUSTOMERS.CUSTOMERS HAVE STARTED GETTING MORE BENEFITS BECAUSE OF THE COMPETITION AMONG ALL THE BANKS.

In a recent interview of new central bank of india's head(i think Mr Srinivas),who has shown outstanding growth rate of more than 200% suggested that banks don't focus much on NON PERFORMING ASSETS,which increases their liablities.

Banks are focusing on insurance and some even sell Ulips like deposits. Many will loose  customers in near future. Happy Mis selling.

The new trend in Indian Banks started recently , a new feature of ASBA account is worth adding. ACCOUNT SUPPORTED BY BLOCKED AMOUNT (ASBA) for IPO.

Traditionally, Banks were focussing on taking deposits and giving loans.  Slowly it was expanded to cover other services like safe deposit lockers, tax collections, etc.  Today Banks are striving to become one-stop solution - from selling insurance policies to acting as custodian to the shares to home finance, venture capital, investment advisory services, merger and acquisitions, managers to capital issues, project finance - you name it, they are in it.

Banks are now concentrating on Current Accounts and Savings Accounts (CASA).  These help in increasing the customer base and also are a source of cheaper funds.  The Other area of concentration is increasing of Non-Interest Income by canvassing mutual funds, Insurance products etcetera.