Impact of information technology on Indian banking sector

Abstract

The banking industry has undergone a transformation because of information technology (IT), which has altered how financial institutions operate, provide services, and engage with their clients. Everyday enhancement in IT and development of digitalisation in banking sector has led researchers to examine the impact of information technology on Indian banking sector and challenges Indian banks face while implementing IT in its services and products. Though the drastic change and development of banking industry through IT cannot be denied, there is still a need to address issues such as consumer’s trust, technical training of employees, connectivity issues in Indian technological infrastructure, and buyer’s awareness to create a more open and secure banking ecosystem. This qualitative research explores the impact of IT on Indian banking sector and analyses the contribution of IT towards the infrastructural development of Indian banks, major challenges faced by Indian banks in changing technological scenario and scope of IT implementation in the Indian banking. The research even analyses the effect of pandemic on banking sector and brings out recent IT trends in banking sector post-pandemic. This research involves both secondary and primary data (collected through exploratory interviews of 40 bankers, including managing directors to branch managers) of 10 public and private banks in India. The findings of the study resulted to facts such as rise in the level of knowledge and awareness amongst consumers post-pandemic, effectiveness of data management, security, safety, and improvement in the service quality as the major impact of information technology in Indian banking sector and digital banking service, artificial intelligence, robotics, blockchain technology, and IT-driven core banking solutions were identified to be the future scope of IT in banking sector.