Private versus Public Banks

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The young generation of India always prefers services of private banks whereas their parents mostly prefers public sector bank.

Why there is a difference?

A simple question was asked to a youth regarding their choice of bank.  The reply was, we don’t have time for unwanted paper work and other formalities required in public sector banks when we are getting all these services on the click of the button and at the ease of the usage by private banks. Complex procedures of banking always bothered us since childhood. Why People should stand in a queue for hours for getting services? Why there are complex forms for depositing a cheque or for issuing a draft? What is the concept of different color slips opting for different services? Why one would go for public banks when private banks are exploring new ways and techniques for making banking services friendliest and easiest.

The above statement of the young boy shows that customers need are changing rapidly and required change in old marketing practices.

Private banks are attracting customers by providing higher interest rates, better customer services and extensive facilities like online and mobile banking, easy home loans facility etc.

HDFC becomes number one bank in India with a total market capitalization of Rs. 6,25,666.08 crores followed by SBI with a total market capitalization of Rs. 2,93,218.11 crores. Thus we can see that a change in preference of customers is seen from public sector banks to private banks and is is a alarming situation for public sector banks.

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