Bank Stocks

The banking sector refers to the network of financial institutions, like banks and other financial intermediaries, that offers a comprehensive range of financial services to individuals, governments and businesses. These services primarily include lending money through loans, accounts, deposit services, facilitating transactions and more.

According to the RBI, the banking sector in India is well-regulated and capitalised. Notably, the industry has embraced innovative banking models, including payments and small finance banks. Initiatives like the Pradhan Mantri Jan Dhan Yojana and post-payment banks have expanded the sector’s reach.

As of March 2023, the banking system contains 22 private and 12 public sector banks, 46 foreign banks, 1,485 urban cooperative banks, 96,000 rural cooperative banks and 56 regional rural banks. There are 14,74,548 ATMs overall in the country.

As of 2022, over 80% of the population in India has a bank account, while it was 17% in 2009. The banking industry in India has experienced growth aided by the strong economic growth, growing disposable incomes, rising consumerism and simple credit accessibility.

The Indian fintech industry is estimated to reach US$ 150 billion by 2025, positioning it as the world’s third-largest fintech ecosystem. The country boasts over 2,000 DPIIT-recognised Financial Technology (FinTech) businesses, which are showcasing rapid growth. The digital payments landscape in India has witnessed remarkable evolution, earning global recognition. India’s Immediate Payment Service (IMPS) ranks at level five in the Faster Payments Innovation Index (FPII), standing out among 25 countries. Additionally, India’s Unified Payments Interface (UPI) has revolutionised real-time payments, making strides to enhance its global footprint.

• Regulatory environment: Assess the regulatory landscape governing the banking industry. Evaluate the government policies impacting the sector.
• Economic conditions: It is important to evaluate the interest rates and overall economic conditions. Check how the economic conditions can impact the bank’s profitability.
• Technology and innovation: Assess the level of technological intervention within the sector, and banks must keep themselves updated with these changes to satisfy their customers and attract new ones.
• Macroeconomic trends: Monitor broader economic trends that can impact the banking sector. Stay updated on factors like inflation, GDP growth, and monetary policies.

Investing in Banking stocks via Angel One is easy. Simply follow these steps:

• Log in to your Angel One account.
• Click on the search icon and look for your desired Banking stock.
• Now, place your buy order. Simply click on the ‘Buy’ button, enter your desired quantity, and select the order type.
• To complete your transaction, click on the ‘Buy’ button.

If you don’t have a Demat account with Angel One, you can open one for free online within minutes.