Increasing number of players from both banking and insurance sectors are integrating their services to boost their bottomlines and offer wider range of products. This new phenomena is all set to transform the Indian Banking and Insurance environment with the number of joint ventures going up steadily.
Globally, the boundaries demarking the financial services are fast eroding. Thanks to the innovations in the financial services, the movement towards, "One-stop financial supermarket" is catching up. Though the concept has been in the minds of many philosophers, it could not materialize due to the barriers that were inherent in the system. In the past, if specializing in one form of products or services was the norm, then it has been transformed into how wider is the product range that a particular financial institution can offer.
With the evolution of interconnected financial services, more and more financial institutions are forced to offer wide range of sophisticated products to their clients. It is no longer possible for any financial institution operating in globalisized market to survive without additional sources of revenues. This has prompted two big classes of financial institutions to combine their strengths and create a new means of marketing their products and services. On side is the banking sector, which is traditionally, known to be more competitive, and on the other is insurance sector, which has vast untapped potential of growth. When these two sectors join, the result will be bancassurance.
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