State-owned banks should pay more attention to skill-development and improving customer interface to stay relevant in a hugely competitive sector, Finance Minister Pranab Mukherjee said Sunday.
"Good customer service is the heart of banking service delivery. Banking is predominantly a customer oriented business and good customer service is the key to banks’ growth and stability," Mukherjee said at the golden jubilee celebrations of State Bank of India Staff College here.
"With enhanced competition amongst banks, customer service becomes the sole differentiating factor to be leveraged to stay relevant and to forge ahead in the business," the finance minister added.
The Indian banking sector is still dominated by state-owned lenders but the share of the public sector banks in total banking assets has come down significantly from 90 percent in 1991 as a result of more nimble footed private players.
"A substantial part of the current work force in our public sector banks had joined in the 1970s and is in the process of superannuating. It is estimated that in the next few years 80 percent of General Managers, 65 percent of the Deputy General Managers, 58 percent of the Assistant General Managers and 44 percent of the Chief Managers would be retiring," said Mukherjee.
"Customer retention is going to be the key factor for banks, going ahead. To replace the existing workforce, which was basically trained in traditional banking, with personnel with specialized financial service delivery skills, is both a challenge as well as an opportunity."