Digitalisation and Financial Service Innovation in Banking

The banking environment has become highly competitive today. The banking sector is undergoing the process of radical transformation due to excessive competition of foreign and private players and changes in tastes, preference, and habits as well as expectations of customers for newer products. India has a diversified financial sector undergoing rapid expansion, both in terms of strong growth of existing financial services firms and new entities entering the market. The Government of India has introduced several reforms to liberalise, regulate, and enhance this industry. The Government and Reserve Bank of India (RBI) have taken various measures to facilitate easy access to finance for micro, small, and medium enterprises (MSMEs). Also, the advancements in technology have brought the mobile and internet banking services to the fore. Thus, many banks launched contact-less credit and debit cards in the market. These types of cards, which used to near field communication (NFC) mechanism, allowed customers to transact without having to insert or swipe.