The Importance of Women Customers in the Indian Banking Industry

The Importance of Women Customers in the Indian Banking Industry

The Indian banking industry has witnessed a remarkable transformation in the past few decades, with the introduction of new products, services, technologies and regulations. However, one aspect that remains largely untapped is the potential of women customers, who constitute nearly half of the country's population and a significant segment of the workforce.

According to a report by McKinsey Global Institute, advancing women's equality in India could add $770 billion to the country's GDP by 2025. However, women face several barriers to economic participation and empowerment, such as lack of access to education, health care, finance and social protection. These barriers also limit their ability to use banking services and benefit from financial inclusion.

According to the World Bank's Global Findex Database 2017, only 77% of Indian women have an account at a financial institution or with a mobile money provider, compared to 83% of men. Moreover, only 43% of women save money at a formal financial institution, compared to 48% of men. Similarly, only 6% of women borrow money from a formal financial institution, compared to 9% of men.

These gaps indicate that there is a huge opportunity for banks to cater to the specific needs and preferences of women customers and offer them tailored solutions that can help them achieve their financial goals. Some of the benefits of doing so are:

- Increased customer loyalty and retention: Women tend to be more loyal and satisfied customers than men, as they value trust, transparency and quality of service more than price. By providing them with customized products and services that suit their life stages and aspirations, banks can build long-term relationships and reduce churn.

- Enhanced brand reputation and social impact: By serving women customers effectively, banks can demonstrate their commitment to gender equality and social responsibility, which can enhance their brand image and reputation among stakeholders. Moreover, by empowering women financially, banks can contribute to the socio-economic development of the country and its progress towards the Sustainable Development Goals.

- Higher profitability and growth: Women customers represent a large and untapped market opportunity for banks, as they have different and often unmet financial needs than men. By addressing these needs through innovative and differentiated offerings, banks can increase their customer base, revenue and market share. Moreover, women customers can also act as influencers and advocates for banks among their family and social networks, generating positive word-of-mouth and referrals.

Therefore, it is imperative for banks to recognize the importance of women customers and adopt a gender-sensitive approach to serve them better. Some of the strategies that banks can adopt are:

- Conducting market research and segmentation: Banks should conduct regular market research and segmentation to understand the demographics, psychographics, behavior and preferences of women customers. This can help them design products and services that are relevant, convenient and affordable for them.

- Developing gender-specific products and services: Banks should develop gender-specific products and services that cater to the diverse needs and goals of women customers across different life stages and segments. For example, banks can offer savings accounts with features such as flexible deposits, withdrawals and interest rates; loans with lower interest rates, collateral requirements and repayment options; insurance policies with coverage for maternity, health and education; investment products with risk profiles and returns that suit women's preferences; etc.

- Leveraging digital channels and platforms: Banks should leverage digital channels and platforms such as mobile banking, internet banking, social media, chatbots, etc. to reach out to women customers who may face mobility or accessibility constraints due to social or cultural norms. These channels can also enable banks to provide women customers with information, education and guidance on various financial topics and products.

- Creating a gender-friendly culture and environment: Banks should create a gender-friendly culture and environment within their organization that fosters diversity, inclusion and respect for women employees and customers. This can include hiring more women staff at all levels; providing them with training, mentoring and career development opportunities; ensuring equal pay and benefits; creating policies against harassment and discrimination; etc. Additionally, banks should also create a gender-friendly environment at their branches and outlets that ensures safety, privacy and comfort for women customers.

By adopting these strategies, banks can tap into the immense potential of women customers in the Indian banking industry and create a win-win situation for themselves as well as their customers.