Member-only story
The future of banking in India
How cool it will be if all the payment transactions literally any penny earned or spent on shopping online or at physical stores from any of the your bank account can be viewed in graphical manner on a dashboard personalized for you.
History of banking
If we go back in time, the trade didn’t involve money in it but a direct trade of goods and service in exchange of goods and services, such an arrangement is called Barter System. Bartering has it’s own limitation and hence currency system was developed. As currency systems progressed over time, coins and paper notes evolved to support the economies and to encourage trade within & outside the region. The 21st century gave rise to the new disruptive form of currencies: Mobile payment & virtual currencies.
This article will cover exponential growth the mobile payments have seen and how the physical currency will also become obsolete.
Traditional Banking & Emergence of mobile payment
The traditional banks in India offers products like: credit, insurance, account numbers, cards etc. Customers in India have multiple bank accounts and hence tracking expenditure of all the accounts using one mobile app is difficult and thus any bank couldn’t tap into the 100% spending of the customer and hence can’t define the perfectly customized products for the customers. In last couple of years the banking has been mobile with almost every bank giving ease of doing banking through mobile, still there are physical bank branches to avail certain products like loans, insurance etc. PaaS (Payment as a Service) is way for the banks to move forward, the banks are opening up their APIs for the private small player to consume and build the product/use-case on the the top of it to cater to the emerging consumers needs like small merchant lending, B2B payments, UPI payment etc.
Traditional banks have high operational cost for running these physical branches to cater to the customer need and also customers are moving away from physical banks and physical cash, and more towards online banking. With increasing mobile banking penetration, the banks are also going 100% digital- called Neobank.
