A decade of financial sector reforms has led to the creation of financial conglomerates in India. Unlike China, where there are huge risks associated with letting banks get into other businesses, the strong regulatory framework in India has actually spurred India’s financial companies to bigger, better things.

Today, State Bank of India offers life insurance covers of its subsidiary, SBI Life, to all its saving account holders for a small fee. This strategy is paying rich dividends. SBI Life – the insurance arm of State Bank--derives close to 70 per cent of its premium income through this route. With over 100 million customers in the books of State Bank and the seven associate banks in the SBI group, SBI Life has huge potential to notch up volumes.

Even in areas where foreign banks seemed to have an unassailable advantage for decades, Indian universal banks are making serious inroads. On January 1 this year, barely five years after entering retail lending, ICICI Bank touched the 3 million mark in terms of number of credit cards, racing ahead of incumbent Citibank (2.5 million cards), which was the leader in the business for a decade and a half.

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