Foreign banks were allowed to open subsidiaries in India from year 2002 onwards, when Reserve Bank of India opened up the gates for them. This was a happy step for the Indian economy especially after our nation’s push the previous decade, when Manmohan Singh led team had introduced drastic reforms that had opened our economy for foreign investors in year 1991. These international banks have played a very important role in the priority sectors, and have pushed the Indian private and governmental banks as well to improve their standards of service in order to survive in this ever demanding market. The services provided by these banks have been extremely impressive and these banks have brought in a technological revolution in how our banking sector works. Innovation in banking is a game changer now, thanks to these foreign banks.
The last 2 decades have witnessed cut throat competition in Indian banking sector thanks to the introduction of foreign banks in our country. The healthy and strong competition has forced Indian banks to come up with new and unique propositions that customers haven’t heard before. Banks are majorly considered a part of the service industry, and the main objective of all the banks is to provide a better service to a large number of customers and look after their financial requirements. Customer satisfaction is now the biggest priority for all banks in India, be it governmental, private or foreign banks.
Overall, the introduction of foreign banks has been a great blessing for the Indian banking sector and the Indian economy at large.