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Banking on soft skills

Article first published in The Hindu Business Line across all editions

In the post-liberalisation era, Indian public sector banks (PSBs) are facing a number of challenges in retaining and expanding their customer base. These challenges include finding an economically-viable solution for financial inclusion, innovation, human resource and customer relations.

PSBs seem to realise this and have been quick to bring innovative products to market, undertake rapid and aggressive branch expansion and upgraded technology to stave off competition from private banks. Not surprising, as both the public and private sector understand that India will remain a land of opportunity over the coming decade.

According to a recent industry report, the country has 145 million households outside organised banking, which is the largest worldwide. Out of its 600,000 villages in India, only 140,000 were covered by formal banking as of March 2012. Only two-fifths of the population has a bank account. With an increasing per capita income, favourable demographics, facilitative policy and regulatory environment, India is a fertile ground for banks to prosper.

As PSBs strive to provide world-class banking, the defining differentiator will be customer service delivery.

The new age Indian customer has come to expect a lot more from banks than mere mechanisms to save. Customers are more knowledgeable, demanding, analytical and aware of their rights. Whether through approaching the Reserve Bank of India (RBI), Banking Ombudsman, RTI or Consumer Forums, modern-day customers know their rights are not to be denied.

A survey of 14 leading Indian banks, including seven public sector banks, by a well-known company, showcases this discerning characteristic of an Indian customer. Findings from the survey reveal that customer experience is the biggest driver of value.

A growing mass of young, affluent Indian customers are driving a cultural change within the Indian banking sector, particularly in PSBs.

Take one of the leading nationalised banks in India, Punjab National Bank (PNB), which embarked on a remarkable change that included changing its outlook and evolving a strategy to reinforce its vision to be the ‘people’s bank’. The Bank has embarked on an ambitious organisational restructuring exercise named “PNB Pragati” to take it to a higher growth trajectory and give an edge over its peers and new players. PNB has now embraced a philosophy to provide excellent service to customers at all levels. It plans to do this through a combination of innovation, accountability, external orientation, direction, capability, leadership and motivation.

Leading cultural change
PSB’s strategy clearly shows the importance of manpower assets and the role it plays in building profitability and strengthening customer base.

According to banking experts, human resource management is the main area of focus for public sector banks. Indian banks have historically had access to superior talent but there is a lack of specialist skills and new-age leaders. This problem is acute and crippling for these banks. There is an urgent need to attract, hire, develop and retain the best available talent to ensure sustained long-term growth in the banks. They will have to devise innovative strategies to retain talent.

There is no dearth of talent and public banking sector jobs are still the most coveted. In the last three years, PSBs have hired over 1.72 lakh people and, according to industry estimates, there will be as many as 63,000 jobs up for grabs this financial year. Conventional HR measures are ineffective in the face of the steep challenges faced by the public sector. What is required is streamlining human resources and re-skilling bank employees to ensure excellence in customer service. Realising this, PSBs are now giving special emphasis on improving asset quality. Currently, PSBs have a young breed of bankers joining the ranks through aggressive recruitment drives. Coupled with an aging workforce, what comes to the fore is the importance of inducting talent, skilling new recruits, re-skilling experienced professionals with soft skills and leadership, and most importantly sensitisation to customer requirements.

New customer experience
Given the aggressive marketing push from private players, both in banking products and services, what we have is a fickle consumer. Further, mobile banking, ATMs, Internet banking and numerous other innovations have been incorporated to give customers easy access to banking. But no amount of technology or aggressive push can take away the importance of personal interactions in the banking sector. Whether it is expanding customer base or retaining existing customers, bank employees make a difference. A recent survey on Transforming Indian Banking has a very interesting find — 30 per cent of customers surveyed said they do not feel emotionally attached to the bank and given a chance would not select the same bank again nor would they recommend it to friends and family. The answer to this wariness is obvious — poor customer service.

A trained team can nurture customer relationships and build trust over a series of transactions. The customer will value such a relationship and the bank builds customer loyalty.

Though banks understand customer behaviour and its related economic implications they are yet to fully capitalize customer loyalty. PSBs are starting to realise the importance of creating good customer relations and the part their employees play in unleashing the new customer experience.

PSBs are starting to hire seasoned companies that specialise in soft skills training and trust-building skills. Training companies are now conducting a customer service sensitisation program, for a year or more, based on the requirements to improve the customer service practices across India. For this, the content will be designed in consultation with the bank senior management and programmes will be conducted through instructor-led-training mode, while simultaneously developing appropriate methodologies to monitor impact of the training solutions. This will be done through professional trainers engaging both internal and external customer-facing employees at various levels, including branch managers. Effective training solutions will help bank employees do more than marketing their services and products. Front-line employees working in various customer service branches in the bank need to understand how to communicate better and more effectively with customers. This is where soft-skills training is paramount. Right from the clerical staff to the bank manager, soft skills training should be made compulsory as it forms the basis of effective communications and building a long-term relationship with the customer.

Besides external customer service training, banks also need to put equal emphasis on internal engagement-related training. They need to enhance team bonding between officers, clerical staff and sub-staff. This can help banks put an effective coordination mechanism in place so employees are consistent in maintaining quality and uniform messaging.


    Only one area is left, which is dragging banks inspite of all efforts. It is NPAs. It needs help of Govt. to take immediate action.

  • Every employee should realize that their family is surviving because of customers only. Brain storming session should continuously happen and it is time that staff should take oath every day in the morning that they will treat customers well despite customer s indifferent attitude.
    Let bank employees have 100s of problems , it is important that good customer service the only way to come out of their problems.Employees should never feel that the customers are at their mercy…

  • In a way, the PSU banks are in comfortable positions compared to many Private Banks basically due to the fact that their activities are controlled by the govt and many have to implement the policies of the govt and inn the process the actions like write-offs of loans etc., initiated by the govt, and the losses accumulated thereon would be accepted by the govt. Hence, the challenges are much directed towards them and they could remain contented with whatever profits etc., accrue. as they could satisfy themselves of having fulfilled the govt’s obligations as their main work.

  • k natarajan

    Customer service with positive attitude and devotion to duty should be the basic ethics
    of a service industry. Though there is a sea-change in the present counter-staff at some
    of the PSBs, still a lot needs to be done. There is lack of coordination amongst staff,
    certain work is not executed in time by staff unless it is reminded by customers – see
    the Indian Bank. Pension is credited not in time i.e. it is credited haphazardly either on 5th or 7th of
    the next month after lodging complaint at their portal. RBI has to conduct Pension audit
    in Indian Bank and find out everymonth the date of credit of pension to pensioners. There is step
    motherly treatment to pensioners. Even nodal officer of Indian Bank in the rank of GM does not have courtesy in replying to complaints. He uses words which are very cut-throat . If u need proof
    I will forward the correspondence I had with the nodal officer for your perusal and necessary action

  • Only one third of the Public Sector Bank employees are working and remaining
    are just chating and enjoying public money.

    Hope this trend appears in all govt sector employees in our country.
    Banking Industry is one among them.

    Bloody Union Leaders spoils the spirit of the true employees
    All Public Sector Banks must be merged and strict working
    conditions should be stipulated among all the employees.

    I believe this is never going to happen in our country .

    Jai ho ICICI, IDBI,HDFC, AXIS etc.

  • V K Agarwal

    Soft skills and psuchology to understand logical things and requirements of customers is essential to develope customer service & its delivery. Rules & circulars are issued without understanding the basic things. Exeptions have no place in there implementation or its understanding. Thus a lot of deficiency in customer service. Training facilities are ad-hoc. All staff members are not provided its facilities. Just to fill class-rooms,training programs are organised. Some members have attended a number of programs whereas you can segregate a large number of staff who have never attended a program.
    It should be made mandatory for every staff member to attend atleast 2 training sessions evry year for continuity of service or loss of some benefits who fail to comply with training requirments during any calender year.

  • banking industry will be really changing in the future and SOFT SKILL will really play important role.
    I see ALLAHABAD BANK as great future, because i get very good customer service.

  • Dr.Gajanan S.Jog

    Soft skill is a need of every employee in all the establishment where public is a concern. In banking industry the concern is more with the emotions as a banker is dealing with the financial aspects of an individual customer where soft skill plays better role to attract the customer. But these should not be a part of marketing strategy but a real life strategy for each one.-Dr. Gajanan S. Jog, Pune,Soft Skill Trainer

  • Bhola Prasad

    Consider every employee a human. Regulate working hour. Fix accountability, honestly. pay enough. Stop using institutions for vote. Crush the corrupt. Recognise honest workers. Establish inter cadre trust. Fix time bound services. Use technology at most. Take regular feed back from ground /frontline workers. Train employees regular at every level.

  • reghu varma p.k

    There is a cost of action and there is a cost of inaction. The bank has to think which one is more expensive and which one has to be adopted.

  • I really dont agree with the people who are saying that the customer service in SBI is bad. I am several accounts in SBI in Pune and find the amazing staff there but yes if you do compare bits and pieces from prviate banks than SBI lags a little but not to that extent the people are balming.

  • Kavita Kumble

    This is so True!! Banks need to stock up on their service Skills else its going to be a tough path ahead!

  • Rajinder Verma

    This cribbing against SBI is all a lot of gas. They are all okay, only the customer base is Huge !!!!

  • SBI is one of the worst bank in the country as far as services, efficiency is concerned it is the fact that they do not bother about small /retail customer ,the reason behind is the government policies that is all central government offices will have there accounts in SBI thus they get large sum of money for almost negligible cost and because of this the attitude of the bank towards the small/retail customers is not only indifferent but full of arrogance. Probably the word efficiency does not exist in the banks dictionary, in fact half the staff in the every branch of the SBI are not fit to work.


    Yes It is 100% TRUE, Hope Modi Government will do something to change the way these PS Banks Run and make STAFFS accountable for their behaviour towards customers.



    • U must realize the whole scenario before comming to any conclusion. Have u ever considered the condition under which a staff works? What goes around the office in the name of office and union politics? Its easy to roll the ball in someones court but you must also acknowledge the fact that its india and leaders can do anything about vote which is why everything is going on like this

  • charudatta

    bank of india is certainly having very commited management and very efficient workforce. kudos to them. they should continue with their good work in future also. Govt and RBI can repose full faith in this inatitution


    • Absolutely true, hate to step inside a State Bank branch. They just don’t know customer relationship.

    • rupak bandyopadhyay

      but SBI is the most chosen bank for indian citizens:may be they are not aware of best ‘ world’ level service,as Mr Daniel refers to..iN FACT ,IN MANY WORLD FAMOUS CITIES IN THE WEST,A CUSTOMER HAS TO PAY A FEE FOR SERVICES /TRANNSACTIONS AT THE BRANCH PREMISES.Mr Daniel can very well use technology platform to transact.Technology does not discriminate…and always smiling!

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