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Retail banking and its objective (Banking Awareness )

Retail banking and its objective.Retail banking in India is the most popular service that banks provide today. Retail banking is also known as wholesome banking as it constitutes different products like wholesale. Candidates who are going to appear in the clerk examination need to know a few important details about retail banking which has been discussed there.

Candidates can download the details and they can learn it to score good marks. Questions are asked from this segment directly or indirectly in the exam. Also for the banking point of view candidates need to know these details. Retail banking is provided today by all types of banks including private sector and public sector banking system.

They provide various predicts to customers like deposits, loan, ATM, credit cards, debit cards, money disbursement facilities and many more. Now the banks are also selling insurance products of various insurance companies through various channels. These are called banksurrance. In the coming times, banks are expected to provide more products in this segment of banking. Candidates need to have a look on all these services and they will have to understand it. These services are proceed to every customer who want to avail of such services.

Retail banking Sector is characterized by the following points

  • Multiple Products (deposits, credit cards, insurance, investment etc)
  • Multiple Delivery Channels (call centre, branch, Internet and Kisosk)
  • Multiple Customer groups (consumer, small business, and corporate).


This is one of the basis function of the banks which all the banks must produce. In all the deposits thee is insurance which is provided by DIGIC. Accepting deposits from the customers and keeping it safe and providing interest rates on the deposits are the duty of the bank.

Credit cards:

This is another popular services under retail banking which the banks have been providing now. Banks have been providing the credit card and debit card to the customers. Credits cards can be availed from the bank and this is for selective customers only with good income history. Debit cards can be provided to each customer which open the account with the bank.

Insurance products:

Banks have been involved in selling of insurance products of both the private companies and government companies. Banks get commission on these insurance products and so the business flourishes this way.

Loan products:

This is also very poplar service that bank provide today. This is mandatory for all the banks to provide loan to its customers. Bank charged high interest rates on these loan products. There are various loan products which are offered by the banks like personal loan, corporate loan, car loan, agriculture loan, consumption loan etc.

These services which are provided by the banks can be delivered through various channels which are given below.

  • Branch banking
  • Internet banking or Mobile Banking
  • Automated teller machines (ATM)
  • Call centers

Branch banking:

To deliver the services, branch is one of the popular destinations. All the services and basis banking activities occur in the branches.  While the banks have also been targeting several other destinations like call centers, internet banking etc to private service to its customers and to make new customers. Now banks are relying more on the internet banking which costs them less and also the accuracy of the serviced are maintained.

Benefits of retail banking:

  • Retail deposits are stable and constitute core deposits.
  • They are interest insensitive and less bargaining for additional interest.
  • They constitute low cost funds for the banks.
  • Effective customer relationship management with the retail customers built a strong customer base.

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