The financial services sector has been giving a great impetus to the Indian economy, as it accounts for 60 per cent of the gross domestic product (GDP) wherein the financial services segment has been a major contributor. Financial services industry mainly includes banking, financial services (like broking, mutual funds) and insurance and hence, is majorly referred as the BFSI industry.
The Indian Banking, Financial Services and Insurance (BFSI) industry has retained global investor confidence with due diligence even in the toughest of international climate; thanks to its conventional approach and strong fundamentals. Regulators such as the Reserve Bank of India (RBI), the Insurance Regulatory and Development Authority (IRDA), Association of Mutual Funds in India (AMFI) and the Securities and Exchange Board of India (SEBI) formulate policies which are well in alignment with the Government regulations and objectives.
The Indian insurance sector has 24 life insurers and 27 general insurers.
According to data released by IRDA, first year premium of the life insurance companies grew by 1.4 per cent during April-May 2012, wherein the first year premium (combined of the public and private sector insurers) during April-May, 2012 stood at Rs 12,428.83 crore (US$ 2.25 billion), up from Rs 12,253.44 crore (US$ 2.21 billion) during the same period a year ago. A total of 40, 46, 777 policies were enrolled during April-May, 2012.
The gross premium of non-life insurance companies during April-May (2012-13) expanded by 18.27 per cent to Rs 11,387.32 crore (US$ 2.1 billion) from Rs 9,627.91 crore (US$ 1.74 billion).
The Rs 64 trillion (US$ 1.16 trillion)-Indian Banking industry is governed by the Banking Regulation Act of India, 1949 and is closely monitored by RBI.
The Rs 6.70 trillion (US$ 121.25 billion) Indian mutual funds (MF) industry has 44 asset management companies (AMCs). Recent data released by AMFI indicated that average assets under management (AUM) rose by 4 per cent during the first quarter of 2012-13 wherein the industry added over Rs 27,389 crore (US$ 4.96 billion) to mark the asset base at Rs 6,92,180 crore (US$ 125.28 billion).
HDFC Mutual Fund maintained its pole position as the country's biggest MF with an average AUM of Rs 92,625 crore (US$ 16.76 billion), followed by Reliance MF, ICICI Prudential, Birla Sunlife MF and UTI MF.