Industry
Lenders bank on campus recruitment
Summary
- Private banks are hiring in large numbers from campuses since recruiting from the market is more expensive
Mumbai: Private banks are aiming to hire at least 50,000 individuals, including fresh graduates, for entry-level positions over the next year to address the challenge of high attrition, according to bankers and recruitment experts.
The banks are grappling with what they term as “infant mortality", referring to the trend of new hires opting for logistics and delivery services, and leaving their jobs within the first one to three months.
The decision to hire from campuses is driven by the cost-effectiveness compared to recruiting from the open market. “Banks will be hiring around 50,000 in junior positions, including campuses over the next one year," said Upasana Agarwal, partner for professional and financial services at ABC Consultants, an executive search and talent advisory firm.
“Attrition at the junior-most levels can be as high as 50-60% and campus hiring enables a firm to be talent-ready. These models help hiring in bulk rather than bringing talent in a fragmented manner," Agarwal told Mint in an interview.
Attrition has been somewhat secularly spread across the private sector lenders, experts said.
In FY23, attrition was at 34.15% for HDFC Bank, India’s largest private sector lender, 51% in IndusInd Bank, and 30.9% in ICICI Bank. For most banks, the biggest hit came from talent at the junior levels in the non-supervisory segments.
Experts said the impact of attrition is more potent in the long term than in the short term.
“While it is difficult to dissect the impact of such things on the short term performance of an institution, in the long term, this can potentially impact the quality of the talent pool within the organization, its growth and profitability prospects," said Anil Gupta, senior vice-president and co-group head, Icra Ltd.
“Axis Bank will hire about 12,000 from campuses from the batch of 2024—four times more than last year; this is across tier-I, -II, -III institutions. For every skill we have a campus feeder programme," said Rajkamal Vempati, president and head of human resources, Axis Bank.
The bank had hired about 3,300 from campus and academic programmes last year (batch of 2023) and that the spike this time around will be in sections such as lending, corporate and branch banking as well as roles in information technology (IT) and analytics.
Academic programmes refer to training sessions which last about three months when students are still studying and the bank gets them industry-ready before onboarding when they graduate.
The direct campus recruits will be those hired without any pre-training process straight from colleges that could include larger B-schools and engineering colleges.
In the last financial year, lenders witnessed a sharp rise in attrition demand surged for young workforce in sales, marketing with digital skills in insurance, retail and among fintech companies. The uptick in campus hires will also help banks cushion the talent loss.
“A large number of these new hires are for replacement positions. Today, the lenders are facing stiff competition from fintech firms, which is pushing them to penetrate deeper into market places for personal loans, credit cards, etc.," said Kartik Narayan, CEO, staffing, Teamlease Services.
According to banking recruiters, banks are offering about ₹5 lakh in tier-II and -III colleges, which can go up to ₹8 lakh if they have digital skills. The salaries in premier B-schools can range between ₹20 lakh and ₹30 lakh and about ₹15 lakh– ₹20 lakh for the better-known engineering colleges.
devina.sengupta@livemint.com
