Indian banks outperform global peers in digital transition, daily services

Indian banks have introduced features like real-time and future-dated payments, app-based banking through messengers, and virtual card issuance for online transactions, outpacing global peers

Indian banks have recorded significant strides in digital transformation, positioning themselves ahead of global counterparts in several core banking functions, according to Deloitte’s 2024 Digital Banking Maturity (DBM) report.

 

The second edition of the India-focused DBM survey assessed 12 leading Indian banks and revealed that nine have earned the title of ‘Digital Champions’, a classification reserved for the top 10 per cent of global banks surveyed. The country’s average DBM index jumped from 43 per cent in 2022 to 59 per cent in 2024 — a 16 percentage point improvement — surpassing the global average and reflecting a growing digital maturity in customer-facing channels.

   

“Indian Banks have made significant progress across digital banking services, outpacing global average on most fronts, aligning with our 2022 predictions. In only its second year of participation, India has already asserted itself as a rising force among global powerhouses such as the US, China, Brazil and the European Union,” said Himanish Chaudhuri, partner, Deloitte India.

 

What is driving Indian banks’ growth? 

A major contributor to India’s DBM rise has been improvements in day-to-day banking, which alone accounted for nearly 10 percentage points of the overall 16-point increase. Indian banks have introduced features like real-time and future-dated payments, app-based banking through messengers, and virtual card issuance for online transactions. These innovations resulted in a 2.4-point jump in transfers and payments — more than double the global average rise of 1 point, the report noted.

 

Personal finance management (PFM) also saw a 1.9 point increase in the DBM score for Indian banks, far exceeding the global average of 0.1 point. Indian Digital Champions now offer tools to help users categorise expenses, set savings goals and receive automated financial advice.

 

Card management witnessed improvements as well. Banks have introduced services such as customisable and recyclable cards and automatic credit limit settings. While the global average in this category rose by three-point, India still saw a solid two-point increase.

 

Banks expand customer relationships 

Indian banks have also made gains in expanding customer relationships, marked by a three-point rise in the DBM index. Innovations under the ‘Beyond Banking’ umbrella include loyalty rewards, gift card purchases, and access to non-financial benefits, mirroring super app features more common in Asia and South America.

 

The emergence of ecosystem and account aggregation services — which enable users to view multiple bank accounts and access hyper-personalised advice — has further strengthened customer relationships. However, India’s growth in this area (0.5-point) still lags the global average of 3-point.

 

User experience (UX) saw a 2-point improvement, driven by enhanced navigation, simplified interfaces and increased accessibility. These changes contributed to higher engagement levels and improved customer satisfaction across digital channels.

 

The report highlights that Indian banks now outperform the global average in most customer journey segments, including account onboarding and service delivery through mobile and internet banking platforms.

 

How did the global banking sector fare? 

The global banking sector, as observed in the DBM 2024 report covering 349 banks across 44 countries, is increasingly focusing on refining existing digital offerings rather than launching new features. This shift is seen in a universal move towards ‘evolution over revolution’, with an emphasis on service quality, customer convenience and hyper-personalised communication.

 

Globally, banks have also embraced familiar user experiences inspired by e-commerce and social media platforms. Digital Champions are now 2.5 times more likely to offer hyper-personalised services compared with their peers. Features such as financial feeds, emoji-enhanced transfers and interactive investment dashboards are setting new benchmarks in user engagement.

 

Moreover, the emergence of all-in-one super apps — already mainstream in parts of Asia and South America — is being explored by Indian banks, further bridging the gap with global digital leaders.

 

Gaps that still remain in banking system 

Despite India’s strong performance, gaps remain in areas like ecosystem integration and product cross-selling, where global Digital Champions still lead. However, the report underscores that Indian banks are well-positioned to capitalise on digital public infrastructure, favourable regulation and changing consumer preferences.

 

“While Indian banks have effectively mastered the account opening and customer onboarding steps, there is a need to continue prioritising day-to-day banking and expanding customer relationships to enhance service delivery and meet growing customer expectations. To achieve scalability, banks must address data architecture and skill gap issues and ensure enterprise-wide data agility,” Suchintan Chatterjee, partner, Deloitte India, said.

To sustain momentum, the report recommended Indian banks to deepen capabilities in customer support, PFM and end-to-end digital journeys. With continued investment in phygital models and ecosystem partnerships, India is poised to become a global benchmark in digital banking maturity.