research topics in banking and finance in india

• Screen Reader
• Skip to main content
• Text Size A
• Language: English

Case Studies

• EXIM Procedure

Media & Events

• Image Gallery
• Media Coverage

Other Links

• GI of India
• Experience India
• Indian Trend Fair 2022

India Organic Biofach 2022

Gulfood dubai 2023, banking sector in india, as of 2022, more than 80% of the indian population has a bank account in comparison to 17% in 2009., advantage india, robust demand.

* According to the EY 2021 NextWave Global Consumer Banking Survey explored consumers’ primary financial relationships and found that FinTechs and neobanks are gaining ground.

* That demand seems particularly strong when it comes to the critical need of protecting consumer data, where incumbent banks have a trust advantage. Some super apps may also turn to banks for access to banking licenses and to meet other regulatory requirements.

* Indian Fintech industry is estimated to be at US$ 150 billion by 2025. India has the 3rd largest FinTech ecosystem globally.

* BCG predicts that the proportion of digital payments will grow to 65% by 2026.

Innovation in Services

* In the recent period, technological innovations have led to marked improvements in efficiency, productivity, quality, inclusion and competitiveness in the extension of financial services, especially in the area of digital lending.

* Digitalization of Agri-finance was conceptualized jointly by the Reserve Bank and the Reserve Bank Innovation Hub (RBIH). This will enable delivery of Kisan Credit Card (KCC) loans in a fully digital and hassle-free manner.

* In Union Budget 2023, the KYC process will be streamlined by using a 'risk-based' strategy rather than a 'one size fits all' approach.

* In September 2023, Hitachi Payment Services launched India's first-ever UPI-ATM with NPCI.

Business Fundamentals

* The Indian banking industry has been on an upward trajectory aided by strong economic growth, rising disposable incomes, increasing consumerism and easier access to credit.

* Digital modes of payments have grown by leaps and bounds over the last few years. As a result, conventional paper-based instruments such as cheques and demand drafts now constitute a negligible share in both the volume and value of payments.

Policy Support

* The RBI has launched a pilot to digitalize KCC lending in a bid for efficiency, higher cost savings, and reduction of TAT. This is expected to transform the flow of credit in the rural economy.

* In November 2022, RBI launched a pilot project on central bank digital currency (CBDC).

* In Union Budget 2023, a national financial information registry would be constructed to serve as the central repository for financial and ancillary data.

* In March 2023, India Post Payments Bank (IPPB), in collaboration with Airtel, announced the launch of WhatsApp Banking Services for IPPB customers in Delhi.

Banking Industry Report

Introduction.

As per the Reserve Bank of India (RBI), India’s banking sector is sufficiently capitalised and well-regulated. The financial and economic conditions in the country are far superior to any other country in the world. Credit, market and liquidity risk studies suggest that Indian banks are generally resilient and have withstood the global downturn well.

The Indian banking industry has recently witnessed the rollout of innovative banking models like payments and small finance banks. In recent years India has also focused on increasing its banking sector reach, through various schemes like the Pradhan Mantri Jan Dhan Yojana and Post payment banks. Schemes like these coupled with major banking sector reforms like digital payments, neo-banking, a rise of Indian NBFCs and fintech have significantly enhanced India’s financial inclusion and helped fuel the credit cycle in the country.

Indian Fintech industry is estimated to be at US$ 150 billion by 2025. India has the 3rd largest FinTech ecosystem globally. India is one of the fastest-growing Fintech markets in the world. There are currently more than 2,000 DPIIT-recognized Financial Technology (FinTech) businesses in India, and this number is rapidly increasing.

The digital payments system in India has evolved the most among 25 countries with India’s Immediate Payment Service (IMPS) being the only system at level five in the Faster Payments Innovation Index (FPII).* India’s Unified Payments Interface (UPI) has also revolutionized real-time payments and strived to increase its global reach in recent years.

Market Size

The Indian banking system consists of 12 public sector banks, 22 private sector banks, 46 foreign banks, 56 regional rural banks, 1485 urban cooperative banks and 96,000 rural cooperative banks in addition to cooperative credit institutions. As of October 2023, the total number of micro ATMs in India reached 15,30,287. Moreover, there are 1,25,969 on-site ATMs and Cash Recycling Machines (CRMs) and 93,771 off-site ATMs and CRMs.

Banks added 2,796 ATMs in the first four months of FY23, against 1,486 in FY22 and 2,815 in FY21. 100% of new bank account openings in rural India are being done digitally. BCG predicts that the proportion of digital payments will grow to 65% by 2026.

In 2023 (till December 1st, 2023), total assets in the public and private banking sectors were US$ 1688.15 billion and US$ 1017.26 billion, respectively. In 2023 (till December 1st, 2023), assets of public sector banks accounted for 58.32% of the total banking assets (including public, private sector and foreign banks).

Public sector banks accounted for over 57.48% of interest income in 2023 (till December 1st, 2023). The interest income of public banks reached US$ 102.51 billion in 2023 (till December 1st, 2023). In 2023 (till December 1st, 2023), interest income in the private banking sector reached US$ 70.07 billion.

India's digital lending market witnessed a growth of CAGR 39.5% over a span of 10 years. The Indian digital consumer lending market is projected to surpass US$ 720 billion by 2030, representing nearly 55% of the total US$ 1.3 trillion digital lending market opportunity in the country.

According to RBI’s Scheduled Banks’ Statement, deposits of all scheduled banks collectively surged by a whopping Rs.1.75 lakh crore (US$ 2,110.87 billion) as of December 1st, 2023.

According to the BCG Banking Sector Roundup Report of 9M FY23, credit growth is expected to hit 18.1% in 2022-23 which will be a double-digit growth in eight years.

Non-food bank credit registered a growth of 17.6% in November 2022 as compared with 7.1% a year ago on the back of robust credit demand from the segments such as services, industry, personal, and agriculture and allied activities, according to RBI’s statement on Sectoral Deployment of Bank Credit.

Investments/Developments

Key investments and developments in India’s banking industry include:

• In December 2023, ICICI Prudential Life Insurance and Ujjivan Small Finance Bank forged the Bancassurance Partnership.
• In October 2023, AU Small Finance Bank announced the acquisition of Fincare Small Finance Bank in an all-share deal and to merge it with itself.
• According to data released by the National Payments Corporation of India (NPCI), UPI transactions reached 10.241 billion until August 30th, 2023.
• In September 2023, Hitachi Payment Services launched India's first-ever UPI-ATM with NPCI.
• In September 2023, the Reserve Bank of India is likely to bring in CBDC in the call money market.
• In July 2023, Mahindra and Mahindra acquires minority stake in RBL Bank.
• In July 2023, State Bank of India to acquire 100% stake of SBI Capital in SBICAP Ventures for US$ 85.25 million (Rs. 708 crore).
• In June 2023, State Bank of India to acquire entire 20% stake of SBI Capital Markets in SBI Pension Funds.
• In April 2023, HDFC Bank to acquire 20% or more in Griha Pte subsidiary of HDFC Investments.
• M&A activity with an India angle hit a record US$ 171 billion in 2022.
• In April 2022, IDFC to sell Mutual Fund Business to Bandhan-Financial Holdings led Consortium for US$ 550.23 million (Rs. 4,500 crore).
• In March 2022, aggressive Axis Bank acquired Citi's India consumer business for US$ 1.6 billion.
• In December 2022, HDFC Bank to buy 7.75% stake in fintech start-up Mintoak.
• As per report by Refinitiv, Domestic M&A activity saw record levels of activity in 2022 at US$ 119.2 billion, up 156.3% from 2021. Companies like HDFC Bank, HDFC, Ambuja Cements, ACC, Adani Group Biocon, Mindtree, L&T Infotech, AM/NS, Essar Ports were involved in M&A deals in 2022
• On June, 2022, the number of bank accounts—opened under the government’s flagship financial inclusion drive ‘Pradhan Mantri Jan Dhan Yojana (PMJDY)’—reached 45.60 crore and deposits in the Jan Dhan bank accounts totaled Rs. 1.68 trillion (US$ 21.56 billion).
• In April 2022, India’s largest private bank HDFC Bank announced a transformational merger with HDFC Limited.
• On November 09, 2021, RBI announced the launch of its first global hackathon 'HARBINGER 2021 – Innovation for Transformation' with the theme ‘Smarter Digital Payments’.
• In November 2021, Kotak Mahindra Bank announced that it has completed the acquisition of a 9.98% stake in KFin Technologies for Rs. 310 crore (US$ 41.62 million).
• In October 2021, Indian Bank announced that it has acquired a 13.27% stake in the proposed National Asset Reconstruction Company Ltd. (NARCL).
• In July 2021, Google Pay for Business has enabled small merchants to access credit through tie-up with the digital lending platform for MSMEs—FlexiLoans.
• In February 2021, Axis Bank acquired a 9.9% share in the Max Bupa Health Insurance Company for Rs. 90.8 crore (US$ 12.32 million).
• In December 2020, in response to the RBI’s cautionary message, the Digital Lenders’ Association issued a revised code of conduct for digital lending.
• On November 6, 2020, WhatsApp started UPI payments service in India on receiving the National Payments Corporation of India (NPCI) approval to ‘Go Live’ on UPI in a graded manner.
• In October 2020, HDFC Bank and Apollo Hospitals partnered to launch the ‘HealthyLife Programme’, a holistic healthcare solution that makes healthy living accessible and affordable on Apollo’s digital platform.
• In 2019, banking and financial services witnessed 32 M&A (merger and acquisition) activities worth US$ 1.72 billion.
• In April 2020, Axis Bank acquired additional 29% stake in Max Life Insurance.
• In March 2020, State Bank of India (SBI), India’s largest lender, raised US$ 100 million in green bonds through private placement.
• In February 2020, the Cabinet Committee on Economic Affairs gave its approval for continuation of the process of recapitalization of Regional Rural Banks (RRBs) by providing minimum regulatory capital to RRBs for another year beyond 2019-20 - till 2020-21 to those RRBs which are unable to maintain minimum Capital to Risk weighted Assets Ratio (CRAR) of 9% as per the regulatory norms prescribed by RBI.

Government Initiatives

• Bank accounts opened under GoI Pradhan Mantri Jan Dhan Yojana have deposits of over ~US$ 25.13 billion in beneficiary accounts. 51.11 crore beneficiaries banked till December 15th, 2023.
• In September 2023, IREDA partners with banks to boost renewable energy projects in India.
• In March 2023, India Post Payments Bank (IPPB), in collaboration with Airtel, announced the launch of WhatsApp Banking Services for IPPB customers in Delhi.
• In October 2022, Prime Minister Mr. Narendra Modi inaugurated 75 Digital Banking Units (DBUs) across 75 districts in India.
• In Union Budget 2023, a national financial information registry would be constructed to serve as the central repository for financial and ancillary data.
• In Union Budget 2023, the KYC process will be streamlined by using a 'risk-based' strategy rather than a 'one size fits all' approach.
• National Asset reconstruction company (NARCL) will take over, 15 non-performing loans (NPLs) worth Rs. 50,000 crore (US$ 6.70 billion) from the banks.
• National payments corporation India (NPCI) has plans to launch UPI lite which will provide offline UPI services for digital payments. Payments of up to Rs. 200 (US$ 2.67) can be made using this.
• In the Union budget of 2022-23 India has announced plans for a central bank digital currency (CBDC) which will be possibly known as Digital Rupee.
• National Asset reconstruction company (NARCL) will take over, 15 Non-performing loans (NPLs) worth Rs. 50,000 crore (US$ 6.70 billion) from the banks.
• In November 2021, RBI launched the ‘RBI Retail Direct Scheme’ for retail investors to increase retail participation in government securities.
• The RBI introduced new auto debit rules with a mandatory additional factor of authentication (AFA), effective from October 01, 2021, to improve the safety and security of card transactions, as part of its risk mitigation measures.
• In September 2021, Central Banks of India and Singapore announced to link their digital payment systems by July 2022 to initiate instant and low-cost fund transfers.
• In August 2021, Prime Minister Mr. Narendra Modi launched e-RUPI, a person and purpose-specific digital payment solution. e-RUPI is a QR code or SMS string-based e-voucher that is sent to the beneficiary’s cell phone. Users of this one-time payment mechanism will be able to redeem the voucher at the service provider without the usage of a card, digital payments app, or internet banking access.
• As per Union Budget 2021-22, the government will disinvest IDBI Bank and privatise two public sector banks.
• Government smoothly carried out consolidation, reducing the number of Public Sector Banks by eight.
• In May 2022, Unified Payments Interface (UPI) recorded 5.95 billion transactions worth Rs. 10.41 trillion (US$ 133.46 billion).
• According to the RBI, India’s foreign exchange reserves reached US$ 630.19 billion as of February 18, 2022.
• The number of transactions through immediate payment service (IMPS) reached 430.67 million and amounted to Rs. 3.70 trillion (US$ 49.75 billion) in October 2021.
• The RBI has launched a pilot to digitalize KCC lending in a bid for efficiency, higher cost savings, and reduction of TAT. This is expected to transform the flow of credit in the rural economy.
• The RBI has launched a pilot to digitalize KCC lending in a bid for efficiency, higher cost savings, and reduction of TAT. This is expected to transform the flow of credit in the rural economy
• As per the Union Budget 2023-24, the RBI has launched a pilot to digitalize Kisan Credit Card (KCC) lending in a bid for efficiency, higher cost savings, and reduction of TAT. This is expected to transform the flow of credit in the rural economy.
• As per the Union Budget 2023-24, digital banking, digital payments and fintech innovations have grown at a rapid pace in the country. Taking forward this agenda, and to mark 75 years of our independence, it is proposed to set up 75 Digital Banking Units in 75 districts of the country by Scheduled Commercial Banks.
• Additionally, the government proposed to introduce a digital rupee or a Central Bank Digital Currency (CBDC) which would be issued by the RBI using blockchain and other technologies.
• The government also proposed to bring all the 150,000 post offices under the digital banking core business to enable financial inclusion.
• As per the economic survey 2022-23, the permission by RBI to lending institutions to grant a total moratorium of 6 (3+3) months in case of payment failure due between 1st March 2020 to 31st August 2020, infusion of US$ 9.1 billion (Rs. 75,000 crore) for Non-Banking Financial Corporations (NBFCs), Housing Finance Companies (HFCs) and Micro Finance Institutions (MFIs), among others, have also contributed to the revival of the real estate sector. The permission by RBI to lending institutions to grant a total moratorium of 6 (3+3) months in case of payment failure due between 1st March 2020 to 31st August 2020, infusion of US$ 9.1 billion (Rs. 75,000 crore) for Non-Banking Financial Corporations (NBFCs), Housing Finance Companies (HFCs) and Micro Finance Institutions (MFIs), among others, have also contributed to the revival of the real estate sector.
• According to the Economic Survey 2022-23, Over the last few years, the number of neo banking platforms and global investments in the neo-banking segment has also risen consistently. Neo-banks operate under mainstream finance's umbrella but empower specific services long associated with traditional institutions such as banks, payment providers, etc.

Enhanced spending on infrastructure, speedy implementation of projects and continuation of reforms are expected to provide further impetus to growth in the banking sector. All these factors suggest that India’s banking sector is poised for robust growth as rapidly growing businesses will turn to banks for their credit needs. The advancement in technology has brought mobile and internet banking services to the fore. The banking sector is laying greater emphasis on providing improved services to their clients and upgrading their technology infrastructure to enhance customer’s overall experience as well as give banks a competitive edge.

In recent years India has experienced a rise in fintech and microfinancing. India’s digital lending stood at US$ 75 billion in FY18 and is estimated to reach US$ 1 trillion by FY23 driven by the five-fold increase in digital disbursements. The Indian fintech market has attracted US$ 29 billion in funding over 2,084 deals so far (January 2017-July 2022), accounting for 14% of global funding and ranking second in terms of deal volume. By 2025, India's fintech market is expected to reach Rs. 6.2 trillion (US$ 83.48 billion).

References:  Media Reports, Press releases, Reserve Bank of India, Press Information Bureau, www.pmjdy.gov.in , Union Budget 2023-24, Economic Survey 2023-24

Note: Conversion rate used in November 2023, Rs. 1 = US$ 0.012, * - according to an FIS report, # - Microfinances Institution Network

Related News

The RBI seeks to improve retail user access to the e-rupee through collaboration with non-bank payment system operators, such as PhonePe, Google Pay, and Paytm.

NBFCs saw a 6% y-o-y rise in loan sanctions in third quarter of FY24, fuelled by robust consumer, gold, and personal loans.

Credit card transactions rose 11% to US$ 111.4 billion (Rs. 9.30 trillion) during June-December 2023, outpacing sluggish debit card usage.

Prime Minister, Mr. Narendra Modi emphasized India's strategic need to enhance economic self-sufficiency in the coming decade, enabling resilience against global crises and elevating the international prominence of the Indian rupee.

Union Minister for Finance and Corporate Affairs, Ms. Nirmala Sitharaman, stated that the stability of government securities yields has enhanced the overall resilience of the financial markets and bolstered investor confidence in the Indian economy.

Banking India

• Public Sector
• Private Sector
• Foreign Bank

Industry Contacts

• Indian Banks Association
• Reserve Bank of India
• Institute for Development and Research in Banking Technology

NEW INDIA DIGITAL INDIA

India will contribute 2.2% to the world's digital payments market by 2023, while the value of such transaction is expected to reach US$ 12.4 trillion globally by 2025.

IBEF Campaigns

APEDA India Pavilion Gulfood February 20th-26th, 2022 | World Trade Centre,...

Ibef Organic Indian Pavilion BIOFACH2022 July 26th-29th, 2022 | Nuremberg, ...

Promoting Indigenous Start-ups: Case Study of Investor Interest in Small-town Start-ups

As urban markets become saturated, investors are turning their gaze towards the untapped potential of small-town innovation, driven by a desire to fos...

India's White Revolution

The "White Revolution" in India refers to the successful implementation of Operation Flood, a dairy development program launched on January ...

The Growth of Ayurveda in India

Ayurveda, an ancient health system originating from India, has a longstanding history. It revolves around using plants and herbs to maintain health an...

India's Solar Power Revolution

India is leading the renewable energy revolution, with a strategic emphasis...

Empowering MSMEs: Fintech Solutions for Small Businesses in India

Micro, small, and medium enterprises (MSMEs) are the backbone of the Indian...

Unlocking India's Digital SME Credit Gap and Economic Potential

The Indian economy thrives on the contributions of the Micro, Small, and Me...

Not a member

Digital payments and consumer experience in India: a survey based empirical study

• Original Article
• Published: 05 January 2021
• Volume 5 , pages 1–20, ( 2021 )

Cite this article

• Sudiksha Shree 1 ,
• Bhanu Pratap 2 ,
• Rajas Saroy 2 &
• Sarat Dhal 2  

49k Accesses

15 Citations

Explore all metrics

Propelled by recent policy initiatives and technological developments, India’s digital payment system is a promising success story in the making. At the same time, the data also points towards an increasing usage of cash. While aggregate country-level data can indicate overall preferences of citizens, we use a novel online survey-based dataset to understand how factors such as ‘perception’ and ‘trust’ in digital payments, and experience with online frauds, affect the payment behaviour of consumers. While demographic factors like age, gender and income are relevant factors which determine this choice, we find compelling evidence that a person’s usage of digital payment methods is influenced by her perception of these instruments, as well as her trust in the overall payments framework and banking system in general. We find that the degree to which past-experience with online fraud deters usage of digital payments varies with the purpose of the transaction.

Similar content being viewed by others

Evolution of Payment Instruments and Their Development in the Digital Economy

Electronic payment adoption and consumers’ spending growth: empirical evidence from Nigeria

Lukman O. Oyelami, Sulaimon O. Adebiyi & Babatunde S. Adekunle

Identity Theft and Consumer Payment Choice: Does Security Really Matter?

Charles M. Kahn & José M. Liñares-Zegarra

Avoid common mistakes on your manuscript.

1 Introduction

The consensus around the origin and the forms of ancient money has kept changing over the course of recorded history. But, what has not changed over the years is what money does; broadly, it facilitates trade in goods and services as medium of exchange and acts as a credible store of value. Modern day trade demands massive payments to be settled fast over long distances with minimum transaction cost. Evidently, to suit these needs the payment systems are being digitised globally. Cash, however, remains a crucial part of the trade. Therefore, the discourse on the current age payment system revolves around cash vs digital transactions.

While cash might seem convenient as it’s ingrained in our habits and is still readily accepted at more places, digital payments offer convenience by saving time and labour. There are further issues with cash use. While it provides a suitable alternative to aid the informal or parallel economy [ 3 , 21 ], digital payment offers itself as a desirable tool for institutions to fix this problem of traceability. In fact, governments around the world have taken drastic measures at huge costs to clear markets of ‘black money’. Research in the behavioural sciences conveys that people experience higher ‘pain of paying’ when paying in cash than digitally, and this contributes to deferred payments [ 17 , 19 , 20 ]. While cash may not seem to impose any direct transactional cost like digital money, it is still costly for both governments and end-users. A 2014 study found out that residents of Delhi spent around 6 million hours and ₹91 million to access cash, while the Reserve Bank of India (RBI) and commercial banks together spent about ₹210 billion towards currency related operating expenses in the same year. But on the other hand, there are also huge implicit costs to digitise the existing systems and nudge people to change [ 14 ].

In the last decade, India has rapidly digitised its payment systems and promises huge potential in the area. Digital payments recorded an increase of 46.5% in total volume in FY19 on top of an increase of 60.6% in FY18. The Unified Payments Interface (UPI), a payment system that was launched in 2016, has surpassed the milestone of a billion transactions per month. The progress in digitisation has been driven by a healthy mix of technological innovation, policy interventions, and expansion and strengthening of existing infrastructure on the supply side, coupled with an increasing proportion of the population adopting financial and digital instruments on the demand side. The government of India and the RBI have been working in synergy to push for policy and regulatory reforms. Enablers such as Jan Dhan accounts, Aadhaar and penetration of mobiles, and policies like Demonetisation and Goods and Services Tax have brought people closer to technology and banks. Recently, NEFT (National Electronic Funds Transfer) was made operational for 24 h on all days of the week, and RTGS (Real Time Gross Settlement) is expected to follow soon. The launch of UPI, along with already available digital payment modes like NEFT, IMPS, cards and Prepaid Payment Instruments (PPIs) has increased the options available to the consumer. The number of PoS (point of sale) terminals have also increased by about 40 lakhs in the last five years. PoS terminals and lightweight acceptance infrastructure such as QR codes have boosted Card/PPI based payments. Additional payment systems such as Bharat Bill Payment System (BBPS), National Electronic Toll Collection (NETC) system, RuPay cards and AePS have also boosted digital payments and the intent to incorporate modern-day technologies such as tokenisation and contactless payments will further the progress.

Despite this progress, cash use still seems to be on the uptick in India. Our paper seeks to highlight the important factors at the individual level, which influence the consumer’s decisions to use cash or digital payment. While it is critical to push for technological innovations and policy reforms, it is also imperative to understand the aspects that motivate or hinder the adoption of these technologies by the end-user. A recent survey [ 5 ], on the readiness of consumers towards adoption of newer payment technologies, ranked India second out of 27 economies on the FinTech adoption Index. Research conducted at the individual consumer level can provide an insight to understand how certain aspects are at play while making a payment decision. To this end, we use a comprehensive and multidimensional online survey which addresses many hitherto untouched dimensions of this topic, such as the difference in digital spending over various expenditure categories (groceries, e-commerce, utility bills, etc.), the choice of consumers to go purely digital or exercise a mix of cash and digital options, and the effect of psychological factors like perception and trust.

There is a dearth of studies and data covering the behavioural aspects at individual level that have an impact on choice of payment behaviour in the Indian economy. Given the massive heterogeneity of our population, different samples might produce disparate results. The High-Level Committee on Deepening Digital Payments [ 15 ] recommended that there should be periodic surveys to gauge user experience and attitude towards digital payments. The present study, is a small step towards filling the research gap in the context of such analysis.

Our key findings point towards a significant impact of perception of the payment system on how people choose to pay. Not only does a positive perception motivate people to go ‘digital’, but a relatively negative outlook on cash also has a similar impact. This finding is important in light of increasing cash use at the macroeconomic level in the country. Another significant factor is confidence in the payment system. Respondents who trust the service providers and regulators seem to have a greater likelihood of paying digitally. We find inconsistent behaviour when studying the impact of experience of digital payment fraud on choice of payment tool. The impact that experiencing such a fraud has on the choice to pay digitally differs according to the purpose of the transaction. The remainder of the study is presented in five sections pertaining to existing literature, data and methodology, sample summary statistics, empirical findings and conclusion and policy implications.

2 Related literature

The terms digital transaction, electronic transactions, paperless transaction or cashless transaction are almost used interchangeably in common parlance. The RBI Ombudsman Scheme for Digital Transactions (2019) defines digital transactions as “a payment transaction in a seamless system effected without the need for cash at least in one of the two legs, if not in both. This includes transactions made through digital/electronic modes wherein both the originator and the beneficiary use digital/electronic medium to send or receive money”. However, in our paper, a digital transaction is one where the payer and payee both use digital modes of payment.

Policies in many parts of the world are being designed in favour of non-cash payments because of the various problems that cash poses. Cash fuels the parallel or black economy, therefore, phasing it out might solve this problem, especially with large denomination notes [ 20 ]. The cost of printing, destroying and other cash related operational expenses in India are estimated at 1.7% of GDP [ 23 ]. Cash, however, remains a significant part of all the transactions in most countries [ 6 ].

While reading into data on the macro-level can give us a broad idea of people’s overall preferences, data at the individual level gives us an insight into how certain factors impact the choices/decisions consumers make regarding the mode of payment. Following this line of thought, several studies have analysed such issues at the level of the consumers. They reveal that the choice of payment method is impacted by a host of consumer-specific and technological factors. Transaction size has a significant impact on what mode of payment people choose. A cross- country comparison of payment diary survey data of seven countries showed that cash was the preferred mode of payment for smallest 50% and largest 25% of transactions [ 2 ]. In another study, social marginal costs were computed for various instruments for small and large transaction sizes and it was found that for larger transaction sizes, there were significant differences in cost for electronic vs non-electronic payments [ 8 ]. Studies show that demographic characteristics also play a significant role in how people choose to pay. It was found that better education and higher income lead to lower cash use compared to non-cash modes. Certain categories of age show a stronger preference for digital payments Bagnall et al. [ 2 ].

Consumer perceptions on safety/risk, convenience/ease of use, anonymity and costs have been shown to affect payment systems adoption significantly. Png and Tan [ 16 ] show that concerns about privacy emerged as one of the main psychological factors causing a bias towards cash for retail transactions. Kahn et al. [ 10 ] show that business in the unorganised economy was attributed to transactions that could be made in cash and did not reveal the agent’s identity. Bagnall et al. [ 2 ] analysed data from cross-country consumer diary surveys and found that consumers who rated cash high on ‘ease of use’ ended up using it more. In a study assessing payment perception of Dutch consumers, non-price parameters such as ‘acceptance’, ‘convenience’, ‘transaction speed’ and ‘safety’ were used to gauge the perception of payment instruments used at PoS terminals [ 9 ]. Several studies have used the Technology Acceptance Model (TAM) to show ‘perceived usefulness’ and ‘perceived ease of use’ have a significant impact on behavioural intention and thus, actual use of electronic payment systems [ 12 , 18 ].

Perceived trust in the payment system is shown to have a positive effect on the usage of digital modes of payment [ 13 ]. While the central bank and banks are traditional regulators and service providers of payments systems respectively, non-banks have also emerged as new players in the framework. A recent empirical study conducted by the Monetary Authority of Singapore [ 16 ] found that trust in banks impacts the nature of the transaction. A cross-country analysis shows that residents in countries that reported lower trust in banks preferred cash for making transactions. In some cases, while an increase in trust can lead to the opening of accounts, it might not translate to actual usage of those accounts [ 7 ]. Central banks also play a pivotal role in ensuring safety, integrity and stability of the payments system. Experience of online fraud can shape beliefs of perception and trust and can have a direct impact on payment behaviour. Media coverage of these incidents is shown to affect card payment [ 11 ]. The direction, strength and frequency of media coverage affected debit card use. Few studies show that people simply use digital modes of payment because they have exhausted their stock of cash in hand. It is called ‘cash first’ or ‘cash-burning’ and is perceived to be an optimal policy by the consumer [ 1 ]. Some studies also point that people still pay in cash simply because it is difficult to grow out of habits [ 9 ].

3 Survey data and empirical methodology

For the purpose of this study, primary data is collected using a structured questionnaire circulated online (Appendix 1). Following snowball sampling, the survey was shared on various social media platforms for better reach. The questionnaire was drafted in English and Hindi, to both expand and diversify the sample. It consists of 28 questions that are divided into seven sections viz. demographics, access to and usage of technology, awareness of different modes of digital payment, preference and perception on cash and digital payment systems, spending habits, experience related to fraud, and feedback on awareness campaigns.

Our study broadly aims to understand the impact of user perception, trust in payment systems, and experience of online fraud on the choice of mode of payment. For regression analysis, mode of payment is taken as the dependent variable and the independent variable is added to a baseline model according to the hypothesis being tested. Firstly, a baseline model is obtained for all five types of purchases—grocery, utilities, online shopping, durables, and gold. These transactions range from low to high value transactions. The responses recorded for different types of purchases have the following three alternatives:

Always pay in cash,

Always pay digitally, and

Sometimes pay in cash and sometimes digitally.

Since the dependent variable is categorical and has more than two categories, a multinomial logistic regression is best suited for regression analysis. A multinomial logit model is an extension of logit model, with more than two categories, in no particular order. Maximum likelihood estimation is used to obtain the parameters of the model.

Let the model have j  = 1, 2 …, J categories for the dependent variable y , and X be the matrix of independent variables. In a multinomial logit model, we estimate a set of coefficients β j  = ( β 1, β 2…, β J ) corresponding to each outcome j . Setting j  = 1 as the reference or base category ( i.e ., β 1  =  0) , we have:

The parameters of the model are reported in terms of odds or log odds. Given any two possible categories for the dependent variable:

where ( β m  −  β n ) is the  effect of X on log of odds of m versus n . To get parameters of other categories of the outcome, they are similarly compared to the common reference category. For our study, cash usage is taken as the reference category. We begin by creating a baseline logistic regression model by taking demographic characteristics such as gender, age, education, family income, occupation, and place of residence as categorical independent variables. The dependent variable is coded as:

y  = 0 for cash (reference)

y  = 1 for digital payments

y  = 2 for sometimes cash and sometimes digital payments

The following multinomial logistic model is estimated:

The parameter β kj is a vector of β 0j, β 1j … β kj where j ( j  = 0, 1, 2) is the category of dependent variable and there are K  +  1 ( k  = 0, 1, …, K ) independent variables. Since cash is the reference category, β k0 is set to 0. Therefore, β k1 and β k2 are respective log odds relative to the reference category.

Since, all the independent variables are categorical, they are coded as dummy variables. The reference categories for each of the independent variable in the baseline model are mentioned in the first column of Table 1 below.

Next, we add four additional independent variables of interest to the baseline model one by one, to observe the impact of perception (of both cash and digital payment modes separately), confidence in the payment system and fraud experience on the choice to pay digitally.

The perception of cash and digital modes of payment is recorded for four parameters- cost, convenience, safety and privacy/anonymity on a three-point Likert scale with the alternatives ‘bad’ (0), ‘okay’ (1) and ‘good’ (2). The mean score for perception is computed as the simple average of parameter-wise scores for cash and digital payments. Confidence in payment systems is measured on the parameters- trust in the RBI, trust in your payment service providers (e.g. FinTechs) and trust in stability and integrity of your bank. A five-point Likert scale is to measure responses, ranging from strongly agree (0) to strongly disagree (4). The mean score is computed as a simple average of the four parameters. Online fraud experience is quantified based on familiarity with such incidents. The respondents were asked to choose from following alternatives-

I have been a victim to digital payment frauds.

I have received such calls/mails/texts but carefully avoided them.

I have not received such calls/mail/texts but know someone personally who has been a victim.

I have not received such calls/mail/texts and do not know anyone personally who has been a victim.

4 Sample summary statistics

A snapshot of our sample of 640 respondents is given in Chart  1 . The respondents are mostly male and educated. Most of them are either salaried employees, working in the government or private sector. This may be due to the online nature of the survey, and circulation limited to the social circles of the authors, which occurred due to the enforcement of the COVID-19 induced nationwide lockdown in India during the survey period. Responses were received from twenty states of India. The corresponding districts were divided into three tiers according to the HRA (Housing Rent Allowance) classification by the Department of Expenditure, Government of India.

Demographic characteristic of the sample

The responses are summarised in Appendix 2. Awareness as well as usage regarding various digital payment instruments were high in the sample. It is important to keep this in mind while interpreting how payment behaviour is affected by other variables. Our respondents, being from the relatively well-off sections of society, were much more aware and comfortable with cards and UPI, rather than AEPS and USSD code-based payments. Digital mode was preferred for online shopping, paying utility bills, and purchasing durables (mostly medium to high value transactions). A combination of cash and digital modes was preferred for purchases of grocery and gold, which are starkly different in terms of transaction value. Being solely dependent on cash was relatively less preferable for all purposes.

The perception of cash and digital payments are recorded on four parameters viz., ‘convenience’, ‘cost of payment’, ‘safety’, and ‘privacy/anonymity’. It is observed that on an average, digital payments perform better than cash on all four fronts. Confidence in digital payment systems is assessed on four parameters, with regards to banks (preference for depositing money in a bank, as well as trust in one’s own bank), the central bank and in other participants like payment aggregators. Respondents seemed more confident in the RBI and banks, as compared to other service providers.

Technical issues, followed by low acceptance and lack of trust were identified as the major hindrances with digital payments. The experience of online fraud is divided into four categories based on their potential intensity of impact of the fraud. Out of 630 respondents that answered the question, 532 have had some experience of online fraud. Out of 411 respondents who had experienced the incident personally, a majority (279) reported no change in the nature of payments and only 26 mentioned that either they had completely switched to cash or had reduced the use of digital mode of transaction. Respondents were also asked if they reported the incident to the concerned authority after they experienced the fraud personally. Most of the respondents did not report the incident, especially if they had not faced any losses.

5 Multinomial regression model: results and analysis

The baseline model (Appendix 3) provides insights on the effect of demographics on the choice of mode of payment.

5.1 Effect of demographics on mode of payment

Males are more likely to use digital modes of transaction as compared to their female counterparts for both purely digital or a combination of cash and digital instruments. With respect to age, there is pressing evidence in the case of online shopping that older individuals are less likely to pay digitally. While the coefficients are not statistically significant for other kinds of purchases, their signs support this general observation. Education is also seen to have an enabling effect on people when it comes to going digital. The tendency to avoid paying solely with cash for groceries and utilities dwindles with an increase in the level of education of the respondent. Income levels have a statistically significant, positive impact when it comes to online shopping and gold purchases through the exclusively digital payment route. Lower income groups may prefer paying using cash on delivery. Occupation and place of residence have a significant impact on choice of mode of payment for mid and high-value transactions. Homemakers, unemployed and self-employed respondents are least likely to pay digitally. For place of residence, respondents living in Tier-1 cities are more likely to pay digitally.

In general, our results point out that more affluent and privileged groups are still more likely to go digital, compared to disadvantaged groups. Hence, while efforts to expand relevant infrastructure and nudge behavioural change are welcome, an upliftment of the general standard of living of the public, education and urbanisation may also be important ways to promote digitisation of payments.

5.2 Experience of online fraud

The experience of digital payment fraud is measured on a scale of four, with ‘0’ implying ‘I have been a victim of digital payment fraud, which is the highest possible impact of fraud on a person. At the other end, ‘3’ stands for ‘neither experienced digital payments fraud nor know anyone who has been a victim’. The baseline model is augmented with these additional categorical variables, and the results are presented in Table 2 . The reference category for the four fraud indicator variables is the response ‘3’, i.e., the respondent has neither been a victim of digital payment fraud, nor do they know of someone who has. Our paper highlights that frauds have differential impact based on the purpose of the transaction. For grocery payments, experiencing such frauds, first hand or otherwise, seems to demotivate people from using digital payment modes, but there is no such evidence for other types of transactions. In fact, respondents preferred using a mix of digital payments and cash for utilities and durables even if they had previously fallen prey to such frauds. It may be easier for consumers to switch to cash for grocery purchase, as compared to settling utility bills or buying durables.

5.3 Perception of cash vs digital payments

Perception of cash is scored on four parameters- cost of payment through cash, convenience of payment, privacy or anonymity concerns about the payment, and safety of payment. The scores range from 0 (bad) to 2 (good). The total score is computed by taking an average of all the four parameters. The total score is a continuous variable and is added to the baseline model. The resultant coefficient is reported in log odds. As is evident from Table 3 , perception of cash has a strong and significant impact on which mode of payment is chosen by the respondent. As the perception of cash improves, the likelihood of paying digitally decreases across all purchase categories. The reference alternative for payment is taken as payments made only/ always in cash, implying no (zero) relation with perception of cash. As perception improves the likelihood decreases most for grocery (low-value payment) and online payments and least for payments made for purchasing gold followed by durables, both high-value payments.

On the flip side, we also consider the total score for perception of digital payments, which is calculated similar to that for cash above. The coefficients (Table 4 ) are positive and statistically significant, implying that as perception improves, so does the likelihood of paying digitally. Here also, the reference alternative is using only cash. In terms of magnitude, the perception variables seem to affect grocery spends the most and gold spends the least. It can be inferred that a positive outlook on digital payment modes motivates the respondent to pay digitally. However, digital payments still have a long way to go if they are to prove themselves as good substitutes to the cheapness, convenience and privacy of cash use. Another observation from the above results is that high-value payments (gold and durables) are relatively less affected by perception of modes of payment, when compared to low- value payments (grocery).

5.4 Trust in payment system

Besides their perception of payment modes, respondents were also asked about their trust or confidence in the payment system as a whole, which was measured on four parameters. A five-point Likert scale is used, with ‘0’ or ‘strongly agree’ implying high confidence in the payment system and ‘4’, which stands for ‘strongly disagree’ implying extreme lack of confidence in the payment system. The total score is computed by taking an average of scores obtained on all the parameters. As expected, a deterioration in consumer confidence in digital payment systems (or an increase in the ‘lack of trust’ score) worsens the likelihood of paying digitally (Table 5 ).

At the end of the survey, respondents were also asked to give their feedback on digital payments. This gives us an indication of overall sentiments and main concerns of consumers towards digital payments. In Chart  2 , a ‘ wordcloud ’ based on 50 most frequently occurring words in the feedback highlights that consumers favour the ‘convenience’ offered by digital payment methods and have an overall positive sentiment towards such technology-based inventions.

Textual analysis on feedback

6 Conclusion

While governments, regulators and service-providers are working in synergy to enhance the electronic payments systems and related infrastructure, it makes sense to study how these options are perceived by the end-user. The key policy recommendation from our study is that incorporating feedback and gauging public perception can further catalyse digitisation. We observe through our study that perception of digital payment instruments affects the payment behaviour of an individual. Digital payments were not only driven by a positive outlook on digital payments but also a negative outlook on cash. Contrary to popular belief, customers were seen to be willing to discount online fraud experience in the face of higher convenience offered by digital payment modes. The impact of experiencing fraud on the choice to pay digitally differs according to the purpose of the transaction. Also, we cannot ignore the role played by demographic factors in better digital payment adoption. Digital payments adoption is expected to increase in line with the overall socioeconomic development of the population.

While our collected data is from a geographically diverse set of respondents, it is still limited to a certain part of the population. The data has been collected during a country-wide lockdown and therefore could only include respondents who were willing to fill the survey online (English or Hindi). Thus, most of the respondents were already digitally literate, educated and economically sound when compared to the population. This is one of the major limitations of the study. Further, since responses were collected in extraordinary circumstances of nationwide lockdown, they may be biased in the sense that these were times when many were compelled to pay digitally for fear of contracting COVID-19. Also, e-commerce and technology firms (with higher acceptance of digital payments) had stepped up their services, filling in the vacuum created by closure of brick and mortar stores. Various central banks around the world conduct payment diary surveys to gauge useful variables at the individual level and observe their impact on payment behaviour. In the future, surveys like these could be taken up with a broader sample and in a more structured manner, as things gradually return to normal.

Arango-Arango CA, Bouhdaoui Y, Bounie D, Eschelbach M, Hernandez L (2018) Cash remains top-of-wallet! International evidence from payment diaries. Econ Model 69:38–48

Article   Google Scholar  

Bagnall J, Bounie D, Huynh KP, Kosse A, Schmidt T, Schuh SD, Stix H (2014) Consumer cash usage: a cross-country comparison with payment diary survey data. Int J Cent Bank (46)

Cagan P (1958) The Demand for Currency Relative to the Total Money Supply. J Political Econ 66(4):302–328

Chen A, Zeltmann S, Griffin K, Ota M, Ozeki R (2020) Demographic background, perceptions, and e-payment usage among young Japanese. Glob J Bus Discip 4(1):4

Google Scholar  

Ernst and Young (EY) (2019) EY Global FinTech Adoption Index 2019.

European Central Bank (2018) Econ Bull (6)

Galiani S, Gertler P, Ahumada CN (2020) Trust and Saving in Financial Institutions (No. w26809). Natl Bur Econ Res

Garcia-Swartz DD, Hahn RW, Layne-Farrar A (2006) The move toward a cashless society: a closer look at payment instrument economics. Rev Netw Econ 5(2)

Jonker N (2007) Payment instruments as perceived by consumers–results from a household survey. De Economist 155(3):271–303

Kahn CM, McAndrews J, Roberds W (2005) Money is privacy. Int Econ Rev 46(2):377–399

Article   MathSciNet   Google Scholar  

Kosse A (2013) Do newspaper articles on card fraud affect debit card usage? J Bank Finance 37(12):5382–5391

Lai PC (2017) Security as an extension to TAM model: Consumers’ intention to use a single platform E-Payment. Asia-Pac J Manage Res Innov 13(3–4):110–119

Maqableh M (2015) Perceived trust and payment methods: an empirical study of MarkaVIP company. Int J Commun Netw Syst Sci 8(11):409

Mazzotta B, Chakravorti, B, Bijapurkar R, Shukla R, Ramesha K, Bapat D, Roy D (2019). The Cost of Cash in India. The Institute for Business in the Global Context

Nilekani N (2019) Report of the High Level Committee on Deepening of Digital Payments, Reserve Bank of India

Png I, Tan C (2019) Privacy, Trust in Banks and Use of Cash, Macroeconomic Review Volume XIX Issue 1 April 2020 , Monetary Authority of Singapore (ISSN 0219-8908)

Prelec D, Loewenstein G (1998) The red and the black: Mental accounting of savings and debt. Market Sci 17(1):4–28

Ozturk AB (2016) Customer acceptance of cashless payment systems in the hospitality industry. International Journal of Contemporary Hospitality Management

Rick SI (2018) Tightwads and spendthrifts: An interdisciplinary review. Financ Plan Rev 1(1–2):e1010. https://doi.org/10.1002/cfp2.1010

Rogoff K (2015) Costs and benefits to phasing out paper currency. NBER Macroecon Annu 29(1):445–456

Tanzi V (1983) The Underground Economy in the United States: Estimates and Implications. Staff Papers—International Monetary Fund 30(2):283–305

Vinitha K, Vasantha S (2017) Influence of demographic variables on usage of e-payment system. Int J Mech Eng Technol (IJMET) 8:265–276

VISA (2016) Accelerating the growth of digital payments in India: a five-year outlook

Download references

Author information

Authors and affiliations.

Mumbai School of Economics and Public Policy, University of Mumbai, Mumbai, India

Sudiksha Shree

Department of Economic and Policy Research, Reserve Bank of India, Mumbai, India

Bhanu Pratap, Rajas Saroy & Sarat Dhal

You can also search for this author in PubMed   Google Scholar

Corresponding author

Correspondence to Sarat Dhal .

Additional information

The views expressed are those of the authors and do not necessarily reflect the views of the Reserve Bank of India.

Survey on consumer experience and perception about digital modes of payments: questionnaire

See Appendix Tables 6 , 7 , 8 , 9 , 10 , 11 , 12 .

See Appendix Fig. 3 . 

Data summary

See Appendix Table 13 .

Rights and permissions

Reprints and permissions

About this article

Shree, S., Pratap, B., Saroy, R. et al. Digital payments and consumer experience in India: a survey based empirical study. J BANK FINANC TECHNOL 5 , 1–20 (2021). https://doi.org/10.1007/s42786-020-00024-z

Download citation

Received : 16 October 2020

Accepted : 12 November 2020

Published : 05 January 2021

Issue Date : June 2021

DOI : https://doi.org/10.1007/s42786-020-00024-z

Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Payment systems
• Digital payments
• Logistic regression

JEL Classification

• Find a journal
• Publish with us
• Track your research

• Finance & Insurance ›
• Financial Institutions

Banking industry in India - statistics & facts

Indian banking landscape, banking outreach, key insights.

Detailed statistics

Number of banks in India 2023, by type

Value of bank assets in India FY 2013-2023

Number of ATMs in India 2019-2022

Editor’s Picks Current statistics on this topic

Current statistics on this topic.

Leading public sector banks in India 2023, by market cap

Leading private sector banks in India 2023, by market cap

Fintech (Mobile/online banking)

Status of online banking in India 2020

Related topics

Recommended.

• Banking industry in China
• Mobile banking in the U.S.
• Banking industry in Europe
• Banking industry in Japan

Recommended statistics

• Premium Statistic Number of banks in India 2023, by type
• Premium Statistic Value of bank assets in India FY 2013-2023
• Premium Statistic Reserves to debt ratio in India FY 2015-2023
• Premium Statistic Gross non-performing loan ratio SCBs India FY 2008-2023, with estimates for FY 2024
• Premium Statistic Value of foreign exchange reserves in India FY 2010-2023
• Premium Statistic Financial conditions index India Q2 FY 2023, by category

Number of banks across India as of November 2023, by type

Total assets of banks in India from financial year 2013 to 2023 (in trillion U.S. dollars)

Reserves to debt ratio in India FY 2015-2023

Reserves to debt ratio in India from financial year 2015 to 2022, with an estimate for 2023

Gross non-performing loan ratio SCBs India FY 2008-2023, with estimates for FY 2024

Gross non-performing loan ratio of scheduled commercial banks across India from financial year 2008 to 2023, with estimates until September 2024

Value of foreign exchange reserves in India FY 2010-2023

Value of foreign exchange reserves across India from financial year 2010 to 2023 (in billion U.S. dollars)

Financial conditions index India Q2 FY 2023, by category

Financial conditions index in India in 2nd quarter of financial year 2023, by category of banks and financial institutions

• Premium Statistic Distribution of number of banks in India FY 2021, by sector
• Basic Statistic Public sector bank assets in India FY 2013-2023
• Basic Statistic Private sector bank assets in India FY 2013-2023
• Basic Statistic Assets of foreign banks in India FY 2013-2023
• Basic Statistic Loan to deposit ratio of public sector banks in India FY 2012-2023
• Premium Statistic Loan to deposit ratio of private sector banks in India FY 2017-2023
• Premium Statistic Loan to deposit ratio of foreign sector banks in India FY 2019-2023

Distribution of number of banks in India FY 2021, by sector

Distribution of the banking market in India in financial year 2021, by sector

Public sector bank assets in India FY 2013-2023

Public sector bank assets in India from financial year 2013 to 2023 (in trillion U.S. dollars)

Private sector bank assets in India FY 2013-2023

Value of private sector bank assets in India from financial year 2013 to 2023 (in billion U.S. dollars)

Assets of foreign banks in India FY 2013-2023

Foreign banks assets in India from financial year 2013 to 2023 (in billion U.S. dollars)

Loan to deposit ratio of public sector banks in India FY 2012-2023

Credit to deposit ratio of public sector banks across India from financial year 2012 to 2023

Loan to deposit ratio of private sector banks in India FY 2017-2023

Credit to deposit ratio of private sector banks across India from financial year 2017 to 2023

Loan to deposit ratio of foreign sector banks in India FY 2019-2023

Credit to deposit ratio of foreign sector banks across India from financial year 2019 to 2023

Key players

• Premium Statistic Leading public sector banks in India 2023, by market cap
• Premium Statistic Leading private sector banks in India 2023, by market cap
• Premium Statistic State Bank of India's brand value 2016-2023
• Premium Statistic Value of deposits at Punjab National Bank FY 2017-2023
• Premium Statistic Value of deposits at HDFC Bank FY 2017-2023
• Premium Statistic ICICI Bank's total advances FY 2016-2023

Leading public sector banks in India as of December 2023, based on market capitalization (in billion Indian rupees)

Leading private sector banks across India as of 2023, based on market capitalization (in billion Indian rupees)

State Bank of India's brand value 2016-2023

Brand value of State Bank of India from 2016 to 2023 (in billion U.S. dollars)

Value of deposits at Punjab National Bank FY 2017-2023

Value of deposits at Punjab National Bank between financial year 2017 and 2023 (in trillion Indian rupees)

Value of deposits at HDFC Bank FY 2017-2023

Value of deposits at HDFC Bank Limited between financial year 2017 and 2023 (in trillion Indian rupees)

ICICI Bank's total advances FY 2016-2023

Total advances of ICICI Bank Limited from financial year 2016 to 2023 (in billion Indian rupees)

Digital banking

• Premium Statistic Penetration rate of online banking in India 2014-2029
• Premium Statistic UPI usage in India in Q4 2023, by platform
• Premium Statistic Number of NETC partner banks India 2016-2022
• Premium Statistic Partner banks for IMPS India 2013-2023
• Premium Statistic Number of member banks affiliated to NFS India 2018-2023
• Premium Statistic Online banking frauds reported in India 2022, by state

Penetration rate of online banking in India 2014-2029

Penetration rate of online banking in India from 2014 to 2029

UPI usage in India in Q4 2023, by platform

Unified Payment Interface (UPI) usage across India in fourth quarter of 2023, by platform

Number of NETC partner banks India 2016-2022

Number of NETC partner banks in India from November 2016 to January 2022

Partner banks for IMPS India 2013-2023

Number of partner banks for IMPS in India from September 2013 to June 2023

Number of member banks affiliated to NFS India 2018-2023

Number of member banks affiliated to NFS in India from August 2018 to June 2023

Online banking frauds reported in India 2022, by state

Number of online banking frauds reported across India in 2022, by state

Government initiatives

• Premium Statistic Number of rural and urban PMJDY recipients in India 2023, by sector
• Premium Statistic Value of PMJDY deposits in India 2023, by sector
• Premium Statistic Number of PMJDY recipients in India 2023, by public sector bank
• Premium Statistic Value of PMJDY deposits in India 2023, by public sector bank
• Premium Statistic Number of PMJDY recipients in India 2023, by major private bank
• Premium Statistic Value of PMJDY deposits in India 2023, by major private bank
• Premium Statistic Number of loan accounts under PMMY scheme India FY 2021, by category
• Premium Statistic Value of sanctioned loans under PMMY scheme India FY 2022, by financial institution

Number of rural and urban PMJDY recipients in India 2023, by sector

Number of Pradhan Mantri Jan-Dhan Yojana recipients in India as of August 2023, by type and sector (in millions)

Value of PMJDY deposits in India 2023, by sector

Value of Pradhan Mantri Jan-Dhan Yojana deposits in India as of August 2023, by sector (in billion Indian rupees)

Number of PMJDY recipients in India 2023, by public sector bank

Number of Pradhan Mantri Jan-Dhan Yojana recipients in India as of August 2023, by public sector bank (in millions)

Value of PMJDY deposits in India 2023, by public sector bank

Value of Pradhan Mantri Jan-Dhan Yojana deposits in India as of August 2023, by public sector bank (in billion Indian rupees)

Number of PMJDY recipients in India 2023, by major private bank

Number of Pradhan Mantri Jan-Dhan Yojana recipients in India as of August 2023, by major private bank (in millions)

Value of PMJDY deposits in India 2023, by major private bank

Value of Pradhan Mantri Jan-Dhan Yojana deposits in India as of August 2023, by major private bank (in million Indian rupees)

Number of loan accounts under PMMY scheme India FY 2021, by category

Number of loan accounts under Pradhan Mantri Mudra Yojana (PMMY) in India in financial year 2021, by category (in 1,000s)

Value of sanctioned loans under PMMY scheme India FY 2022, by financial institution

Value of sanctioned loans under Pradhan Mantri Mudra Yojana (PMMY) in India in financial year 2022, by financial institution (in billion Indian rupees)

Further reports Get the best reports to understand your industry

Get the best reports to understand your industry.

Mon - Fri, 9am - 6pm (EST)

Mon - Fri, 9am - 5pm (SGT)

Mon - Fri, 10:00am - 6:00pm (JST)

Mon - Fri, 9:30am - 5pm (GMT)

Research Topics & Ideas: Finance

120+ Finance Research Topic Ideas To Fast-Track Your Project

If you’re just starting out exploring potential research topics for your finance-related dissertation, thesis or research project, you’ve come to the right place. In this post, we’ll help kickstart your research topic ideation process by providing a hearty list of finance-centric research topics and ideas.

PS – This is just the start…

We know it’s exciting to run through a list of research topics, but please keep in mind that this list is just a starting point . To develop a suitable education-related research topic, you’ll need to identify a clear and convincing research gap , and a viable plan of action to fill that gap.

If this sounds foreign to you, check out our free research topic webinar that explores how to find and refine a high-quality research topic, from scratch. Alternatively, if you’d like hands-on help, consider our 1-on-1 coaching service .

Overview: Finance Research Topics

• Corporate finance topics
• Investment banking topics
• Private equity & VC
• Asset management
• Hedge funds
• Financial planning & advisory
• Quantitative finance
• Treasury management
• Financial technology (FinTech)
• Commercial banking
• International finance

Corporate Finance

These research topic ideas explore a breadth of issues ranging from the examination of capital structure to the exploration of financial strategies in mergers and acquisitions.

• Evaluating the impact of capital structure on firm performance across different industries
• Assessing the effectiveness of financial management practices in emerging markets
• A comparative analysis of the cost of capital and financial structure in multinational corporations across different regulatory environments
• Examining how integrating sustainability and CSR initiatives affect a corporation’s financial performance and brand reputation
• Analysing how rigorous financial analysis informs strategic decisions and contributes to corporate growth
• Examining the relationship between corporate governance structures and financial performance
• A comparative analysis of financing strategies among mergers and acquisitions
• Evaluating the importance of financial transparency and its impact on investor relations and trust
• Investigating the role of financial flexibility in strategic investment decisions during economic downturns
• Investigating how different dividend policies affect shareholder value and the firm’s financial performance

Investment Banking

The list below presents a series of research topics exploring the multifaceted dimensions of investment banking, with a particular focus on its evolution following the 2008 financial crisis.

• Analysing the evolution and impact of regulatory frameworks in investment banking post-2008 financial crisis
• Investigating the challenges and opportunities associated with cross-border M&As facilitated by investment banks.
• Evaluating the role of investment banks in facilitating mergers and acquisitions in emerging markets
• Analysing the transformation brought about by digital technologies in the delivery of investment banking services and its effects on efficiency and client satisfaction.
• Evaluating the role of investment banks in promoting sustainable finance and the integration of Environmental, Social, and Governance (ESG) criteria in investment decisions.
• Assessing the impact of technology on the efficiency and effectiveness of investment banking services
• Examining the effectiveness of investment banks in pricing and marketing IPOs, and the subsequent performance of these IPOs in the stock market.
• A comparative analysis of different risk management strategies employed by investment banks
• Examining the relationship between investment banking fees and corporate performance
• A comparative analysis of competitive strategies employed by leading investment banks and their impact on market share and profitability

Private Equity & Venture Capital (VC)

These research topic ideas are centred on venture capital and private equity investments, with a focus on their impact on technological startups, emerging technologies, and broader economic ecosystems.

• Investigating the determinants of successful venture capital investments in tech startups
• Analysing the trends and outcomes of venture capital funding in emerging technologies such as artificial intelligence, blockchain, or clean energy
• Assessing the performance and return on investment of different exit strategies employed by venture capital firms
• Assessing the impact of private equity investments on the financial performance of SMEs
• Analysing the role of venture capital in fostering innovation and entrepreneurship
• Evaluating the exit strategies of private equity firms: A comparative analysis
• Exploring the ethical considerations in private equity and venture capital financing
• Investigating how private equity ownership influences operational efficiency and overall business performance
• Evaluating the effectiveness of corporate governance structures in companies backed by private equity investments
• Examining how the regulatory environment in different regions affects the operations, investments and performance of private equity and venture capital firms

Asset Management

This list includes a range of research topic ideas focused on asset management, probing into the effectiveness of various strategies, the integration of technology, and the alignment with ethical principles among other key dimensions.

• Analysing the effectiveness of different asset allocation strategies in diverse economic environments
• Analysing the methodologies and effectiveness of performance attribution in asset management firms
• Assessing the impact of environmental, social, and governance (ESG) criteria on fund performance
• Examining the role of robo-advisors in modern asset management
• Evaluating how advancements in technology are reshaping portfolio management strategies within asset management firms
• Evaluating the performance persistence of mutual funds and hedge funds
• Investigating the long-term performance of portfolios managed with ethical or socially responsible investing principles
• Investigating the behavioural biases in individual and institutional investment decisions
• Examining the asset allocation strategies employed by pension funds and their impact on long-term fund performance
• Assessing the operational efficiency of asset management firms and its correlation with fund performance

Hedge Funds

Here we explore research topics related to hedge fund operations and strategies, including their implications on corporate governance, financial market stability, and regulatory compliance among other critical facets.

• Assessing the impact of hedge fund activism on corporate governance and financial performance
• Analysing the effectiveness and implications of market-neutral strategies employed by hedge funds
• Investigating how different fee structures impact the performance and investor attraction to hedge funds
• Evaluating the contribution of hedge funds to financial market liquidity and the implications for market stability
• Analysing the risk-return profile of hedge fund strategies during financial crises
• Evaluating the influence of regulatory changes on hedge fund operations and performance
• Examining the level of transparency and disclosure practices in the hedge fund industry and its impact on investor trust and regulatory compliance
• Assessing the contribution of hedge funds to systemic risk in financial markets, and the effectiveness of regulatory measures in mitigating such risks
• Examining the role of hedge funds in financial market stability
• Investigating the determinants of hedge fund success: A comparative analysis

Financial Planning and Advisory

This list explores various research topic ideas related to financial planning, focusing on the effects of financial literacy, the adoption of digital tools, taxation policies, and the role of financial advisors.

• Evaluating the impact of financial literacy on individual financial planning effectiveness
• Analysing how different taxation policies influence financial planning strategies among individuals and businesses
• Evaluating the effectiveness and user adoption of digital tools in modern financial planning practices
• Investigating the adequacy of long-term financial planning strategies in ensuring retirement security
• Assessing the role of financial education in shaping financial planning behaviour among different demographic groups
• Examining the impact of psychological biases on financial planning and decision-making, and strategies to mitigate these biases
• Assessing the behavioural factors influencing financial planning decisions
• Examining the role of financial advisors in managing retirement savings
• A comparative analysis of traditional versus robo-advisory in financial planning
• Investigating the ethics of financial advisory practices

The following list delves into research topics within the insurance sector, touching on the technological transformations, regulatory shifts, and evolving consumer behaviours among other pivotal aspects.

• Analysing the impact of technology adoption on insurance pricing and risk management
• Analysing the influence of Insurtech innovations on the competitive dynamics and consumer choices in insurance markets
• Investigating the factors affecting consumer behaviour in insurance product selection and the role of digital channels in influencing decisions
• Assessing the effect of regulatory changes on insurance product offerings
• Examining the determinants of insurance penetration in emerging markets
• Evaluating the operational efficiency of claims management processes in insurance companies and its impact on customer satisfaction
• Examining the evolution and effectiveness of risk assessment models used in insurance underwriting and their impact on pricing and coverage
• Evaluating the role of insurance in financial stability and economic development
• Investigating the impact of climate change on insurance models and products
• Exploring the challenges and opportunities in underwriting cyber insurance in the face of evolving cyber threats and regulations

Quantitative Finance

These topic ideas span the development of asset pricing models, evaluation of machine learning algorithms, and the exploration of ethical implications among other pivotal areas.

• Developing and testing new quantitative models for asset pricing
• Analysing the effectiveness and limitations of machine learning algorithms in predicting financial market movements
• Assessing the effectiveness of various risk management techniques in quantitative finance
• Evaluating the advancements in portfolio optimisation techniques and their impact on risk-adjusted returns
• Evaluating the impact of high-frequency trading on market efficiency and stability
• Investigating the influence of algorithmic trading strategies on market efficiency and liquidity
• Examining the risk parity approach in asset allocation and its effectiveness in different market conditions
• Examining the application of machine learning and artificial intelligence in quantitative financial analysis
• Investigating the ethical implications of quantitative financial innovations
• Assessing the profitability and market impact of statistical arbitrage strategies considering different market microstructures

Treasury Management

The following topic ideas explore treasury management, focusing on modernisation through technological advancements, the impact on firm liquidity, and the intertwined relationship with corporate governance among other crucial areas.

• Analysing the impact of treasury management practices on firm liquidity and profitability
• Analysing the role of automation in enhancing operational efficiency and strategic decision-making in treasury management
• Evaluating the effectiveness of various cash management strategies in multinational corporations
• Investigating the potential of blockchain technology in streamlining treasury operations and enhancing transparency
• Examining the role of treasury management in mitigating financial risks
• Evaluating the accuracy and effectiveness of various cash flow forecasting techniques employed in treasury management
• Assessing the impact of technological advancements on treasury management operations
• Examining the effectiveness of different foreign exchange risk management strategies employed by treasury managers in multinational corporations
• Assessing the impact of regulatory compliance requirements on the operational and strategic aspects of treasury management
• Investigating the relationship between treasury management and corporate governance

Financial Technology (FinTech)

The following research topic ideas explore the transformative potential of blockchain, the rise of open banking, and the burgeoning landscape of peer-to-peer lending among other focal areas.

• Evaluating the impact of blockchain technology on financial services
• Investigating the implications of open banking on consumer data privacy and financial services competition
• Assessing the role of FinTech in financial inclusion in emerging markets
• Analysing the role of peer-to-peer lending platforms in promoting financial inclusion and their impact on traditional banking systems
• Examining the cybersecurity challenges faced by FinTech firms and the regulatory measures to ensure data protection and financial stability
• Examining the regulatory challenges and opportunities in the FinTech ecosystem
• Assessing the impact of artificial intelligence on the delivery of financial services, customer experience, and operational efficiency within FinTech firms
• Analysing the adoption and impact of cryptocurrencies on traditional financial systems
• Investigating the determinants of success for FinTech startups

Commercial Banking

These topic ideas span commercial banking, encompassing digital transformation, support for small and medium-sized enterprises (SMEs), and the evolving regulatory and competitive landscape among other key themes.

• Assessing the impact of digital transformation on commercial banking services and competitiveness
• Analysing the impact of digital transformation on customer experience and operational efficiency in commercial banking
• Evaluating the role of commercial banks in supporting small and medium-sized enterprises (SMEs)
• Investigating the effectiveness of credit risk management practices and their impact on bank profitability and financial stability
• Examining the relationship between commercial banking practices and financial stability
• Evaluating the implications of open banking frameworks on the competitive landscape and service innovation in commercial banking
• Assessing how regulatory changes affect lending practices and risk appetite of commercial banks
• Examining how commercial banks are adapting their strategies in response to competition from FinTech firms and changing consumer preferences
• Analysing the impact of regulatory compliance on commercial banking operations
• Investigating the determinants of customer satisfaction and loyalty in commercial banking

International Finance

The folowing research topic ideas are centred around international finance and global economic dynamics, delving into aspects like exchange rate fluctuations, international financial regulations, and the role of international financial institutions among other pivotal areas.

• Analysing the determinants of exchange rate fluctuations and their impact on international trade
• Analysing the influence of global trade agreements on international financial flows and foreign direct investments
• Evaluating the effectiveness of international portfolio diversification strategies in mitigating risks and enhancing returns
• Evaluating the role of international financial institutions in global financial stability
• Investigating the role and implications of offshore financial centres on international financial stability and regulatory harmonisation
• Examining the impact of global financial crises on emerging market economies
• Examining the challenges and regulatory frameworks associated with cross-border banking operations
• Assessing the effectiveness of international financial regulations
• Investigating the challenges and opportunities of cross-border mergers and acquisitions

Choosing A Research Topic

These finance-related research topic ideas are starting points to guide your thinking. They are intentionally very broad and open-ended. By engaging with the currently literature in your field of interest, you’ll be able to narrow down your focus to a specific research gap .

When choosing a topic , you’ll need to take into account its originality, relevance, feasibility, and the resources you have at your disposal. Make sure to align your interest and expertise in the subject with your university program’s specific requirements. Always consult your academic advisor to ensure that your chosen topic not only meets the academic criteria but also provides a valuable contribution to the field. 

If you need a helping hand, feel free to check out our private coaching service here.

You Might Also Like:

thank you for suggest those topic, I want to ask you about the subjects related to the fintech, can i measure it and how?

Submit a Comment Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

• Print Friendly

Home » Blog » Dissertation » Topics » Finance » Banking and Finance » Banking and Finance Dissertation Topics (28 Examples) For Research

Banking and Finance Dissertation Topics (28 Examples) For Research

Mark May 26, 2020 Jun 5, 2020 Banking and Finance , Finance No Comments

Are you searching for banking and finance dissertation topics? We understand that selecting a dissertation topic is one of the biggest challenges. So, we offer a wide range of banking and finance dissertation topics and project topics on banking and finance. You can also visit our site for corporate finance dissertation topics and other business […]

Are you searching for banking and finance dissertation topics? We understand that selecting a dissertation topic is one of the biggest challenges. So, we offer a wide range of project topics on banking and finance.

Our team of writers can provide quality work on your selected banking and finance research topics. Once you select from the research topics on banking and finance, we will provide an outline, which can provide guidance on how the study should be carried out .

If you have come to this post after searching for corporate finance or finance topics, following are the seperate posts made on these topics.

• Finance Research Topics
• Corporate Finance Research Topics

Banking and finance dissertation topics

Role of micro-loans in the modern financial industry.

Online currencies like Bitcoin brought changes in the concept of fiat currencies.

Identifying the forces causing American retail banking centres to change.

Analysing the treatment of off-balance sheet activities.

Examining the role of internet banking in society.

Evaluating how the modern economy prevents a run on the banks from happening.

To find out whether the technology can replace the role of retail banking centre.

Relationship between housing loans and the 2008 recession.

Impact of foreign direct investment on the emerging economies.

Identifying the best capital structure for a retail bank.

To study the effect of mergers and acquisition on employee’s morale and performance in the case of banks.

Evaluating the credit management and issues of bad debts in commercial banks in the UAE.

To what extent the electronic banking has affected customer satisfaction.

Portfolio management and its impact on the profitability level of banks.

Impact of interest rate on loan repayment in microfinance banks.

An appraisal of operational problems facing micro-finance banks in delta state.

Studying the impact of risk management on the profitability of banks.

Evaluation of bank lending and credit management.

Role of automated teller machine on customer satisfaction and retention.

Examining the impact of bank consolidation on operational efficiency.

Competitive strategies and changes in the banking industry.

Development of rural banking in the case of developed countries.

The effect of electronic payment systems on the behaviour and satisfaction level of customers.

How does the organisational structure affect the commercial banks and their performance?

How can banks use ratio analysis as a bank lending tool?

Evaluating the relationship between e-banking and cybercrime.

Studying the importance of credit management in the banking industry.

Problems related to loan granting and recovery.

Topic With Mini-Proposal (Paid Service)

Along with a topic, you will also get;

• An explanation why we choose this topic.
• 2-3 research questions.
• Key literature resources identification.
• Suitable methodology with identification of raw sample size, and data collection method
• View a sample of topic consultation service

Get expert dissertation writing help to achieve good grades

• Writer consultation before payment to ensure your work is in safe hands.
• Free topic if you don't have one
• Draft submissions to check the quality of the work as per supervisor's feedback
• Free revisions
• Complete privacy
• Plagiarism Free work
• Guaranteed 2:1 (With help of your supervisor's feedback)
• 2 Instalments plan
• Special discounts

Other Posts

• Corporate Finance Dissertation Topics (29 Examples) For Your Research December 28, 2019 -->
• Finance Dissertation Topics Examples List (37 Ideas) For Research Students May 29, 2017 -->

Message Us On WhatsApp

• Hire a writer

projects Xtra.com

Banking and finance project topics and materials, these are banking and finance department project topics with available well written chapters 1 to chapter 5, please click on a project topic to view its details and order for the complete material, list of banking and finance project topics, accounting project topics & materials, agricultural science project topics and materials, business admin/mgt project topics & materials, biochemistry project topics & materials, biological science project topics & materials, civil engineering project topics and materials, computer science project topics and materials, criminology & security project topics & materials, economics project topics and materials, education project topics and materials, electrical engineering project topics and materials, english language project topics and materials, entrepreneural studies project topics, fine and applied art project topics and materials, fishery & aquaculture project topics & materials, genetics and biotech project topics & material, geology project topics & materials, guidance & councelling project topics&materials, health science project topics and material, history & religious studies project topics, home and rural economics project topics, human resource management project topics, industrial chemistry project topics and materials, law project topics and materials, library and information science project topics, marketing project topics & materials, marine transport management project materials, mass communication project topics and materials, micro biology projecttopics and materials, office technology project topics & materials, science lab tech slt project topics & materials, secreterial studies project topics and materials, sociology project topics and materials, political science project topics and materials, psychology project topic and materials, public administration project topics and materials.

• More DEPARTMENTS... CLICK HERE

All rights Reserved.