Digital Banking & Financial Services: â€œTodayâ€™s Challenges and Opportunitiesâ€
The development of an economy is largely influenced by financial marketsâ€”they competitively allocate financial resources that are mobilised from savers and investors among users in the economy. India â€˜s central bank, the Reserve Bank of India (RBI), has proactively shaped the development of financial markets in India through its series of economic policy reformsâ€”market-determined interest and exchange rates, current account convertibility, monetary policy dealing with price-based instruments, auction-based allocation in the government securities market (GSM), and phased capital account. Technological advancement enables a broader and inclusive banking sector and in the process, is a key driver for the sustained and inclusive growth of the economy. Banks have not gained in terms of efficiency partly because the much needed business process re-engineering was not done. Thus, there is a need to take care of what we could not achieve in the first round of technology implementation and think beyond CBS. Supported by the latest technology, banks would need to identify new business niches, to develop customized services, to implement innovative strategies and to capture new market opportunities. The Financial system acts as nerve system of a nationâ€™s economy. Indian financial system is undergoing restructuring process for efficient mobilization and allocation of resources it can be segmented into organized, unorganized semi-organized systems. The organized system has money and capital markets as major components and also set of facilitators catering to financial intermediation this supports increasing capital accumulation through institutionalization of savings and investment. The financial system consists of many subsystems like financial services, banks, financial institutions etc. it provides the principal means by which savings are transformed into investment. Given its role in the allocation of resources, the efficient functioning of the financial system is of critical importance to a modern economy. The banking sector is a major player in the system concentrating its business in organized and urban sector. Financial system is a key weapon in monitoring the economic progress of any country, because eventually all efforts and resources are measured in financial terms.