Innovation in the Indian Banking Industry: An Exploration of the Evolution, Motivations, and Effects

The purpose of the chapter is to discuss the evolution of the Indian banking industry and the role of innovation within the industry. It explores the motivations for innovation, types, actors involved, investments made and protection issues of banking innovations. The study showcases the current situation while also instigating future possibilities of research for the topic. To meet the objective, data was obtained via interviews with management representatives of 5 Indian banks. Given the changes witnessed by the Indian banking industry since independence and after the liberalization phase in 1991, innovation in Indian banking is seen as a fit solution for addressing the increased competition in this sector. Innovation is seen as important to create differentiation and respond to evolving consumer needs. Given the paucity of academic literature on innovation in Indian banking, this exploratory study can be taken as contributory to academics and research for this topic.