Wednesday, August 15, 2007

Creditable Choice
Usha Albuquerque

Banking is probably the oldest job in the world. Banks manage money and wealth. Their activities facilitate basic economic processes of production, distribution and consumption. They take care of people's savings; issue travellersí cheques; finance projects; act as executors and trustees; and extend loan and credit services. Besides, banks promote entrepreneurship and self-employment. Banking is, therefore, considered the most important segment responsible for the growth of any economy.

With the advent of liberalisation and entry of foreign banks, banking in India has seen a perceptible change in structure and functions.

While the information and communication technology revolution is also changing the operational environment of the banks. Moreover, banking procedures have today become computerised with electronic banking through automatic teller machines, internet banking, online banking, multi-city cheque facilities, and other gadgetry speeding up transactions. Banks have also diversified their activities into varied areas in the personal banking sector to include housing finance, leasing and hire purchasing. Private banks are extending services to include wealth management and equity trading apart from a range of credit facilities.

Today, there are 27 public sector banks, 33 private banks and 43 foreign banks operating in the country, providing jobs to lakhs of people. While the public sector banks still hold the biggest share of the banking business, accounting for about 83 per cent of the total deposits, private banks and foreign banks are bringing in a range of new and innovative services to attract customers. All these changes have resulted in the general upgrading of jobs, calling for more people with professional backgrounds. It has translated into a need for more management and fewer subordinate-level jobs.

Chances to cash in on

There are different kinds of banks, and while the operations may be similar in all banks, the focus of activities might differ according to the segment of population at whom services are directed.

The Reserve Bank of India is at the apex of the banking structure. Its role is of a regulatory and developmental authority. The RBI issues the guidelines and procedural instructions to all financial institutions and banks. These include:

  • The Regional Reserve Banks

  • State Bank of India and associate banks

  • Nationalised banks

  • Private sector banks

  • Foreign banks

There are, in addition, rural banks which service the rural sector and co-operative banks managed by various co-operatives. There are also financial institutions which provide banking facilities for the development of industry, such as the Industrial Development Bank of India, and Small Industries Development Bank of India, as well as those that promote foreign trade, development of capital markets, financing of the housing sector, and so on.

While banking, in general, refers to receiving deposits, transferring funds, and provision of loan and credit facilities, bankers are involved in a number of banking activities.

Retail banking

This division provides a range of financial services to individual customers and small companies. While Retail Banking implies routine transactions like deposits and withdrawals; money transfer; foreign currency exchange and travellers' cheque encashment, Personal Banking deals with loans, credit and mortgages; insurance policies; investment schemes; pension funds; and advice to customers on various financial matters.

Corporate banking

It caters to the needs of corporate houses. Interactions here are mainly with large companies and government agencies.

Corporate Finance: Includes credit risk assessment; and advice to clients on matters such as corporate mergers and acquisitions, raising capital, and business strategy regarding competitors and outside factors.

Merchant banking

It offers different types of fund-based financial services on behalf of corporate clients, or institutional investors like pension funds, investment trusts, or those in the securities business. The work here centres around activities like managing capital issues, portfolio management, international financing; public issue management and the buying and selling of shares.


This takes care of foreign exchange reserves. Responsibilities include dealings in foreign currency; as well as portfolio management.

Rural banking or Agri-banking

It is the financial assistance given by the government for promoting agriculture, small-scale industries, cottage and village industries, handicrafts and other allied economic activities in rural areas.

International banking

This takes place when a bank in one country has transactions with banks in other countries. Their operations include, providing simple loans to customers against letter of credit, facilitating export and import transactions for the customer and providing foreign exchange facilities for loan conversion.

Work profiles

Banking work can be at two levels:

Clerical: Where the main tasks are to maintain account books and documents; and attend to customers at the counter.

Managerial: Which involves organising, controlling and supervising banking activities, or holding overall charge of one or more departments or branches.

Officers at all levels deal with people as well as money and figures. Great emphasis is therefore laid on their ability to relate to customers, identify their needs and promote the bank's services. Specific tasks include loan approvals; customer interactions; branch management; and marketing of services and products.

A career with a bank can also develop into non-banking functions like personnel and public relations.

Banks have also begun to recruit professionals like lawyers, engineers, agriculturists and experts from a range of different fields depending on the consumers they service.

As financial services are getting automated, the industry requires a large number of computer experts, both in computer maintenance and software. Private computer service contractors are also in great demand. It would be important to have a BE or MCA degree for such jobs.

Entering the field

Recruitment in nationalised banks is done through examinations conducted from time to time by the Banking Services Recruitment Board (BSRB) and the State Recruitment Board (SRB). Graduates (perfectly commerce and economics) in the age group of 18-26 are eligible to take the Bank Probationary Officers exam which is conducted by the UPSC at an all-India level.

This exam is in two parts, the first is a general mental ability test (including maths and english) and an essay type paper, the second part is a paper on economics and social issues. Two further rounds of interviews must be cleared before appointment as probationary officer.

Private and foreign banks take in MBAís from the premier management institutes, Chartered Accountants with above average results, finance experts and economists with post-graduate qualifications directly, while fresh graduates can hope to find jobs as direct marketing executives, personal banking executives and home banking executives. A preliminary on-campus interview assesses personality; aptitude and academic merit. Those meeting the set stipulations must clear a final interview before appointment in a foreign bank.

Course clues

All banks within the national banking structure have established training colleges that conduct compulsory one-month orientation courses for new recruits. Probationers are taught the banking procedure in preparation for their first posting.

All new recruits in foreign banks also undergo a three-week orientation course before they undergo in-house training at the bank.

However, besides on-the-job training, one can also do a specialised course in banking from a number of universities offering such courses.

University of Madras, Chennai,offers a bachelorís degree in bank management, as also a PG diploma in banking. Other universities offering this course include Aligarh Muslim University and Bhartidasan University. Guru Gobind Singh Indraprastha University, New Delhi offers a BBA in Banking & Insurance.

The other courses in banking and finance for graduates include a PG diploma in banking operations offered by the Institute of Finance Banking and Insurance, New Delhi, a joint collaboration between NIIT and ICICI Bank, as also the PG programme in banking and Finance offered by the National Institute of Bank Management, Pune, for which admission is through the CAT exam.

With the increasing growth of the financial sector banking has emerged as a high-profile career with good job prospects. Salaries are high and career growth is assured for those with the right aptitude and skills. High intelligence, numerical skills and the ability to relate to people at all levels is among the basic requirement for those getting into banking. If you have self-confidence, the ability to think analytically, and the ability to cope with stress and handle heavy responsibility you can go far in this field. It is also necessary to have an overall general awareness, and be constantly updating knowledge about financial and economic policies at the national and global level. Moreover as the financial sector grows, a good banker will certainly be in great demand.

Training talk

Other universities offering diplomas or certificate courses in different aspects of banking (law, management and administration, masterís degree) are:

  • Maharaja Sayajirao University of Baroda, Vadodara

  • Maharishi Dayanand University, Rohtak

  • Guru Ghasidas University, PO Koni, Bilaspur

  • Ravishankar University, Raipur-492 010.

  • Gujarat University, Navrangpura, Ahmedabad-380 003

  • Utkal University, PO Vani Vihar, Bhubaneshwar-751 004.

  • Annamalai University, PO Annamalai Nagar-608 002;

  • Sri Venkateshwara University, Tirupati-517 502.

  • SNDT Women's University, 1, Nathibai Thackeray Road, Mumbai-400 020.

  • University of Rajasthan, Jaipur-302 004.

  • Shivaji University, Vidyanagar, Kolhapur-416 004.

  • Marathwada University, Aurangabad-431 604.

  • Bhartidasan University, Palkalai Perum, Tiruchirapalli-620 024.

  • Manipur University, Canchipur, Imphal-795003.

The writer is a noted career expert