RBI sees higher attrition levels in banks

Mumbai: With the banking sector being thrown open to niche as well as more private players, RBI deputy governor R Gandhi warned the industry to brace for higher attrition, being already faced by highly unionised public sector lenders.

"We've been telling banks to expect people to hop from one institution to another. Old method of developing a cadre and expecting them to continue with you for life is going to change. Attrition is going to be the norm," Gandhi said.

Addressing a seminar organised by the Sebi-managed National Institute for Securities Markets, at its upcoming campus at Patal Ganga near here, Gandhi said he foresees the demand for high specialisation rising in the banking space.

"It is going to be expertise-driven and niche. When expertise, knowledge and specialisation are in high demand, people will be hopping jobs," he said.

However, he said RBI doesn't have latest attrition levels in but added that it foresees a spike in demand for experienced hands with more new banks come up.

On inflation, which rose to 5.11 per cent in January, a tad above 5 per cent target set by RBI for 2016, Gandhi expressed confidence that low inflation will continue. "We are definitely going to have a low and stable inflation climate that will lead to low interest rate regime." He said that when low interest rate regime stays for long it leads to higher investor appetite. This spawns various new financial instruments, products and services that again increase demand for more expert hands in the market.