History And Overview Of Barclays In India - Free Essay Example

Background Unlike most rapidly expanding, emerging markets, Indiaà ¢Ã¢â€š ¬Ã¢â€ž ¢s banking sector has exhibited financial stability and a trend towards improved governance under the management of its central bank, the Reserve Bank of India (RBI). Today, Indiaà ¢Ã¢â€š ¬Ã¢â€ž ¢s banking industry is one of the major beneficiaries of the countryà ¢Ã¢â€š ¬Ã¢â€ž ¢s ascendant economic power. Improving consumer purchasing power, coupled with more liberal attitudes towards personal debt, is fueling Indiaà ¢Ã¢â€š ¬Ã¢â€ž ¢s explosive banking segment. The primary objective of the study was to find whether the customers are satisfied with their existing banks. The secondary objective of the study was to find out: Are the customers aware about Barclays? What type of facilities, both client and technological, do the customers want. Public sector banks in India are facing stiff competition from their private sector counterpart. On top of the challenges that are posed by the competitors before the retail banking sector in India, are the regulations imposed by the top body over the industry frontage and the array of choices available to the customers. Retail banking refers to banking in which banks undertake transactions directly with clients, rather than company or other banks. Services offered by the banks include: mortgages, savings and checking accounts, debit cards, personal loans, credit cards, etc. The key issues analyzed in the report are: Market analysis of different product segments in the retail banking industry. Factors driving the growth of retail banking industry in India. This report covers a wide range of issues related to the Work Place Banking (Salary Accounts) in India. In formulating this report, I had to really get to the grass root level of banking, customer services and their implementation in India. The best possible tests have been used where ever needed to get to the correct results for determining what is beneficial and what is not beneficial for the organization. The report also analysis the past issues as well as discusses the action and strategies to be taken by the retail banking industry in future. Introducing Barclays PLC Barclays is a major global financial services provider engaged in retail and commercial banking, credit cards, investment banking, wealth management and investment management services, with an extensive international presence in Europe, the USA, Africa and Asia. With more than 300 years of existence and knowledge in banking, Barclays operates in over 50 countries and employs 135,000 people. Barclays invests, lends, move, and protects money for over 30 million clients and consumers worldwide. History of Barclays PLC This bank traces its roots back in 1690 in London. The name Barclays became associated with the business in 1736, when James Barclay, son-in-law of one of the founders became a partner in the business. In 1728, the bank moved to 54 Lombard Street, which was identified by the à ¢Ã¢â€š ¬Ã…“Sign of Black Spread Eagleà ¢Ã¢â€š ¬?, over the years becoming a core part of bankà ¢Ã¢â€š ¬Ã¢â€ž ¢s identity. The bank took its name from Alexander and David Barclay, who provided credit to transatlantic slave traders. Barclays has many U.K high street branches and it has also joined up with the post office ltd to provide personal banking services to customers who lived near post office branch and who need financial services such as secured and unsecured loan Barclays in India Barclays unveiled its Global Retail and Commercial Banking division in India over the past year as part of its plan to be a leading global bank. In a very short span of time, Barclays is already making waves in India one of the worldà ¢Ã¢â€š ¬Ã¢â€ž ¢s fastest growing countries. The commercial banking division, which began its operations in late November 2006, services a variety of leading Indian corporation from large multinationals and public sector companies to small and medium enterprises. It offers great facilities of loans, payments cash management services, deposits, trade finance and funds solutions. Barclays customer banking services were launched in May 2007 with a group of products that give our customers better control over their finances. Our offer includes inventive proposition such as personal loans that come with smaller monthly repayments and credit cards that allow customers to choose their payment date. This facility has helped Barclays connect with Indian customers and become the ideal option in the centres we are present in. Barclays is scattering its reach across India and now has 4 offices in the country. We have our main office in the financial center of Mumbai in Western India. We have recently reinforced our presence in Northern India with a branch in Delhi, capital of India, which is also one of the subcontinentà ¢Ã¢â€š ¬Ã¢â€ž ¢s key business centres. Additionally, Barclays has a branch in Kanchipuram, which is near Chennai, and another at Nelamangala near Bangalore, both of which cover important nodes in Southern India. CRITICAL REVIEW OF LITERATURE Retail banking refers to the dealing of commercial banks with individual customers, both on liabilities and assets sides of the balance sheet. Fixed, current or savings accounts on the liabilities side and mortgages, loans etc. on the property side, are the more important of the products offered by the banks. Related services include debit cards, credit cards, dedicated services etc. Todayà ¢Ã¢â€š ¬Ã¢â€ž ¢s retail banking sector is characterized by three basic characteristics: Multiple products( deposits, credit cards, insurance, investments and securities) Multiple channels of distribution (call centres, branch, internet etc.) Multiple customer groups( consumer, small businesses and corporate) Researches done in the past on Retail Banking have concluded that the Retail Banking in India has fast emerged as one of the major drivers of the overall banking industry and has witnessed enormous growth in the recent past. The Retail Banking Report encompasses extensive study analysis of this rapidly growing sector. It mainly covers study of the present status, current trends, major issues challenges in the growth of the retail banking sector. The retail banking strategies of banks are undergoing major transformation, as banks adopt a mix of strategies like organic growth, acquisitions and alliances. This has resulted in a standard shift in the marketing strategies of the banks. Public Sector Banks players are adopting aggressive strategies, leveraging their branch network and their customer vase to earn a larger share of the retail pie. Banks are also going in for innovative strategies like cross selling and packaged selling of retail products. At the same time, new foreign players are also entering this high growth sector and one of such player i s BARCLAYS BANK. Barclays is among the leading bank of U.K. Retail Banking in India continues to redefine the credit growth in the country. It grew by a whopping 44.4% in 2005-06 to touch Rs3,538 billion. Different foreign banks like HSBC, ABNAMRO, CITI BANK, STANDARD CHARTERED, DEUTSCHE BANK were quick to realize the growth opportunity in India were as BARCLAYS BANK is a late entrant, but it is trying its level best to compete and match up the standards with different leading banks. Currently overall, banking in India is considered as fairly mature in terms of supply, product range and reach-even though reach in rural India still remains a challenge for the private sector and foreign banks. Even in terms of quality of assets and capital competence, Indian banks are considered to have sparkling, strong and clear balance sheets, as compared to other banks in similar economies in its region. The Reserve Bank of India is an independent body, with minimal force from the government. The confirmed policy of the Bank on the Indian Rupee is to manage volatility-without any declared exchange rate and this has mostly been true. With the growth in the Indian economy likely to be strong for quite some time, especially in its services sector, the demand for banking services-especially retail banking, mortgages and investment services are expected to be strong. MAs, takeovers, asset sales and much more action (as it is unraveling in China) will happen on this front in India. The Reserve Bank of India in March 2007, allowed Warburg Pincus to boost its chance in Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has been allowed to hold more than 5% in a private sector bank since the RBI announced norms in 2006 that any stake exceeding 5% in the private sector banks would need to be vetted by them. Currently, India has 88 scheduled commercial banks (SCBs) 28 public sector banks (that is with the Government of India holding a stake), 29 private banks (these do not have government stake; they may be publicly listed and traded on stock exchanges) and 31 foreign banks. They have a combined network of over 53,000 branches and 17,000 ATMs. As per the report by ICRA Ltd, a rating agency, the public sector banks hold over 75 percent of total assets of the banking industry, with the private and foreign banks holding 18.2% and 6.5% respectively. There is an increase in the retail banking products in India because of the changing consumer demographics. The middle class people are increasingly affluent and bulging. India is having the youngest population in the world with increasingly literacy levels. Therefore a younger population means a bigger opportunity. Some of the other reasons for retail growth are: Increasing availability Entry of banks has led to increased competition and coverage Increasing use of technology has further enhanced reach and accessibility Key Products Analyzed Key products analyzed in this report include: Work Place Banking (Salary Saving Account). Key Players Analyzed This section provides an overview, and key facts of several key players like PNB, ICICI and Barclays bank. RESEARCH METHODOLOGY (a) Objective of study The primary objective of the study was to find whether the companies are satisfied with their existing banks. The secondary objective of the study was to find out: Are the customers aware about Barclays? What type of facilities, both client and technological, do the customers want. (b) Problem definition How to make the companies aware about Barclays and its features. (c) Hypothesis Null Hypothesis Ho : Customers are satisfied with the services provided by their existing bank. Alternative Hypothesis Ha : Customers are not satisfied with the services provided by their existing bank. (d) Research design The research design adopted is a combination of exploratory, formal and descriptive. Since the study is based on a analyzing through data collected by survey so it is formal and it has certain elements of exploration as well. And since the study is related with measuring where or whether, it is descriptive in nature. To achieve the above objective of the study, the following instruments were used- Questionnaires- It consists of a number of questions printed or typed in a definite order on a form or a set of forms. People have to answer the questions themselves. To do the above research, we used a structured questionnaire which had 12 questions about the respondentsà ¢Ã¢â€š ¬Ã¢â€ž ¢ interest in SALARY ACCOUNT-BARCLAYS, its services, their satisfaction with services and technology etc. (e) Sample design A sampling design is a definite plan for obtaining a sample from a given population. It refers to the technique or procedure the researcher would adopt in selecting items for the sample. For this research we have chosen simple random probability sampling. Sample size- 50 (f) Data Primary data collected through questionnaires. Secondary data collected through various sources given in references.