Banking, Financial Services and Insurance (BFSI) sector is a vital sector for the Indian economy. It is a barometer of the economy and is reflective of macro-economic variables. According to the RBI, the banking sector of India is adequately capitalized and well regulated. The Global Financial Crisis was followed by a sluggish economic growth in most of the countries around the world. The banking industry was among the worst hit segments of the financial sector.
While the Indian financial markets (esp. forex and equity) were affected by the turbulence banking industry largely remained resilient in the aftermath of the crisis. Similarly, the insurance industry, despite feeling the pinch of the global meltdown, managed to perform relatively better than its global counterparts. The BFSI sector could generate a lot of employment in the next decade with the potential to create more than a million jobs. According to a report by Mint, by 2020, our banking industry could break into the top five largest banking industries in the world. There is a lot of optimism surrounding the banking sector in the long run with hopes of being the world’s 3rd largest banking industry by 2025. Our total banking assets are expected to cross US$ 28.5 trillion in 2025. This year, the government passed the Insurance Laws (Amendment) Bill, allowing 49% FDI in the Indian insurance companies. This amendment is expected to give a boost to the insurance penetration in the country by bringing in 8-10 billion $ capital in the industry. As of now, our insurance penetration stands at an abysmal low of 3% of the GDP, against global average of 8%. By raising FDI cap from 26% to 49%, insurance awareness, information as well as penetration will be increased.
Business challenges faced by BFSI sector
Increasing Bad Loans- According to World Bank data, NPAs, which constituted 2.4% of total loans in 2010, surged to 4% of total loans last year. Bad loan ratios have more than doubled in the last 5 years at most of the banks. State-run banks contribute about 90% of India;s bad loans and unfortunately they have been the worst hit. In order to remain healthy and grow, these state run banks will need to raise about $75 billion in the next four years as per the government. A major challenge for both public and private sector banks is the ability to quickly dispose of non-performing assets.
Meeting higher capital requirements as per the Basel III norms, which call for banks to boost the capital adequacy ratios by March 2019, is another challenge for the industry. Also, bank credit growth has plummeted to a 20 year low.
How C1 India adds value?
- C1 India is one of the fastest growing companies in e-Auction space with 50,000+ auctions in its kitty. Its breakthrough award wining e-Auction engine offers both forward auctions (to sell and manage NPAs) as well as reverse e-Auctions to facilitate procurement at lesser costs.
- C1 India is the industry leader in e-procurement space and provides a centralized, reliable, efficient, transparent and fully secure e-procurement system.
- We bring the expertise and capability to manage the process end-to-end by supporting buyer & vendor database management thereby increasing the security and regulating requirements.
- As pioneers of the B2B e-Commerce – e-Auctions and e-Procurement digital space, we also provide various value added services such as spend management, contract management, analytics, digital signature certificates to serve your needs.
Top BFSI players trust C1 India
Our clients include some of the most distinguished banks such as Punjab National Bank, Oriental Bank of Commerce, State Bank of India, Bank of Baroda, Central Bank of India, HDFC, Union Bank of India, Andhra Bank, Indian Overseas Bank, Punjab & Sind Bank, State Bank of Travancore, IDBI Bank, Bank of Maharashtra, Dena Bank, Canara Bank, Indian Bank, and several others. These big players have discovered path-breaking ways to get most out of the e-Auctions and e-Procurement process conducted by C1 India.
In many e-Auction events our clients like Dena Bank, SBI, Punjab and Sindh Bank have recorded astounding profit margins from 200-300 % against the auction opening price.
Reach us today to understand how we can help you get most out of your NPAs through e-Auctions.