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Business News/ Market / Stock-market-news/  HDFC Bank has highest mobile banking share: report
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HDFC Bank has highest mobile banking share: report

HDFC Bank Ltd has emerged as the leader in mobile banking with 38.2% market share in FY15, followed by ICICI Bank

Most of the state-run banks, which account for more than 70% of the banking assets in the country, are clear laggards in this segment, with just 17% share in total mobile transaction value. Photo: Sneha Srivastava/MintPremium
Most of the state-run banks, which account for more than 70% of the banking assets in the country, are clear laggards in this segment, with just 17% share in total mobile transaction value. Photo: Sneha Srivastava/Mint

Mumbai: HDFC Bank Ltd has emerged as the leader in mobile banking with 38.2% market share in FY15, followed by ICICI Bank Ltd, according to data compiled by BNP Paribas Securities India Pvt. Ltd. Most of the state-run banks, which account for more than 70% of the banking assets in the country, are clear laggards in this segment, with just 17% share in total mobile transaction value.

With urban customers and those below 35 years of age clearly preferring mobile banking, market leaders in this segment stand a better chance of becoming their primary bank. Lenders who win the battle in this space will be able to bolster their low-cost deposit base and fees.

BNP Paribas analyst Avneesh Sukhija points out a significant mismatch between the market share of savings accounts and mobile banking as of now. For instance, in FY15, even as SBI beats HDFC Bank with a savings account market share of 39.3% compared with the latter’s 9.5%, the mobile banking market share of HDFC Bank at 38.2% is much higher than SBI’s 12.9%.

All government-run banks, except SBI and Union Bank of India, are yet to catch up on the digital banking side, BNP Paribas said in its digital banking report.

Given the clear preference towards mobile banking, the mismatch could result in potential loss in the market share of savings accounts for these banks sooner rather than later, according to the report. Erosion of market share in low-cost deposit franchise will lead to narrower margins and slowing profits.

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Published: 24 Jul 2015, 11:12 AM IST
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