Indian financial market is changing rapidly and emerging on the global platform. This fuel new growth in recruitment for banking and financial sector.
Payment banks are different from traditional banks. They are the new stripped-down type of banks, which are expected to reach customers mainly through their mobile phones. They are expected to increase the financial inclusion in the country by providing banking services to the people who are currently out of the reach of banking services.
The payment banks target migrant labourers, low-income households, and small businesses, offering savings accounts and remittance services with a low transaction cost. These banks will enable poorer citizens to take their first step into formal banking, who transact only in cash till date. The innovation is also expected to accelerate India’s journey into a cashless economy.
Salient Features Of Payment Banks
– Can accept demand deposits (only current account and savings accounts) with a ceiling limit of Rs.1 lakh per customer.
– Pay interest at the rate notified by the RBI.
– Can issue ATM & Debit Cards
– Charge a fee as commission. This will be the sole earning for the banks.
– Will also have to maintain CRR (Cash reserve ratio) just like other Scheduled commercial banks (SBI, PNB, BoB, Dena, ICICI, etc.)
– Can become Business Correspondents of another bank
– Can distribute mutual funds, insurance, pension products
– Hand foreign remittances of personal and current account
– The Deposit up to Rs.1 lakh is insured by the DICGC (Deposit Insurance and Credit Guarantee Corporation), same as in bank accounts.
– Cannot engage in lending services, i.e., they cannot give loans, thus phasing out the fear of NPA.
– Cannot involve any credit risk and can only invest in less than one-year G-Secs or treasury bills.
– Cannot issue Credit Cards
– Cannot take NRI deposits
– Cannot set up an NBFC subsidiary
Approved Payment Banks In India
– Aditya Birla Nuvo Limited
– Airtel M Commerce Services Limited
– Cholamandalam Distribution Services Limited
– Department of Posts
– Fino Paytech Limited
– National Securities Depository Limited
– Reliance Industries Limited
– Dilip Shantilal Shanghvi
– Vijay Shekhar Sharma
– Tech Mahindra Limited
– Vodafone m-pesa Limited
New Job Opportunities In New Banking Sector
It is estimated that more than 1,500 jobs with salaries going up to Rs 1.50 crore will be up for grabs in the 11 payments banks that are set to start operations by September 2017. Research and studies say that:
– Near about 150 senior executives will be hired among these 11 entities
– Approximately 370 mid-level executives are expected to get recruitment
– More than a 1,000 junior-level staff will be employed in the next coming months.
Talent Is Needed To Perform This Major Functions:
– Sales and distribution
– Merchant acquisition
– Strategic alliances
– Regulatory and compliance.
There will be a spike in demand for talent from liability product teams of transaction banking, digital product teams of retail banks or e-commerce platforms, and merchant acquisitions, sales & distribution talent from insurance companies retail banking and FMCG companies.
Significant Hiring On Technology Piece
There are two things mainly bothering the management of payment banks – one is technology, and the other is the governance and risk piece. They demand very different types of talent compared to the traditional banks. Payment banking players are looking for banking, consumer, and technology-oriented people. Also, product thinking and innovation, and people who understand markets beyond large urban areas are high in demand in this sector.
Noticeably, the entities are looking for talent internationally as well, where people have worked with disruptive products, including from places such as Singapore and Silicon Valley. A lot of talent come from the cash management side of banks and some from FMCG and other sectors.
Talent scarcity will be seen especially in product roles, regulatory & compliance roles, business solution teams where the pool will emanate from a select few banks, therefore pushing up both demand and compensation.
Work Culture Is Different From Existing One
India’s unbanked population is 233 million. Even those who can be considered ‘included’ through Pradhan Mantri Jan Dhan Yojana (PMJDY), are still new to banking products. As per the 2011 census, 833 million people stay in rural areas, and a significant part of that population has little awareness of new-age banking services, even if they have the accounts.
This banks mainly focus on unbanked masses of the country, the majority of whom resides in rural areas. So definitely, work culture of this banks is surely different. The new hires may need to work in the remotest of places and have to spend a considerable amount of their career time at these places.
Trends To Follow In Payment Banking Sector
– The banking sector may create up to 20 lakh new jobs in the next 5-10 years, helped by the issuance of new licenses and efforts being made by the RBI and the Government to expand financial services into rural areas.
– Less than 30 percent of the Indian population having access to bank accounts, accounts for expanding banking into rural areas especially, that have so much potential to boost growth and profitability.
– Hiring in the sector is expected to happen across regions with lower tier cities to be one of the biggest beneficiaries.
– With investment banks being set up in Tier 2, 3 and 4 cities, there will be growing demand for business correspondence, sales executives and other banking professionals to reach out to the rural population.
– Investment banks will require staff for branches, as well as for functions such as operations, sales, IT, risk management, compliance, among others.
– The sector will hire people with banking, technical, consumer and product expertise for key positions, thereby triggering a revival in recruitment for banking.
– Need candidates in the client-facing and client-servicing roles.
The concept of new payments bank is compelling as it opens another route for inclusive banking. While time will tell how successful this model will be in incremental terms, the RBI on its part has permitted to probably the best players who are capable of making this a reality.
Why Skillventory For Payment Banks Related Hiring
Indian financial market is very vast, changing rapidly and emerging on the global platform. This fuel new growth in financial services and creating demand for more skilled finance professionals. We at Skillventory meet talent needs from the front line to senior management roles. We are not only recruiters but also acts as consultants to our clients.