India’s banking sector is still labour intensive but digital technologies are changing the composition of the banking workforce, more so in nationalised banks.

Analysis of Reserve Bank of India (RBI) data on employees of Scheduled Commercial Banks (SCBs) shows that while headcount has been on a steady rise on an overall basis, the growth has come from hiring staff in the ‘officers’ cadre of the banks, while the number of juniors (comprising clerks, associates, sub-staffs) has declined since at least FY17.

Changing proportion

In FY17, the total employee count at India’s SCBs was 13 lakh with 62 per cent of them officers at around 8 lakh and the remaining 38 per cent comprising junior staff (clerks and sub-staff). However, the proportion of officers in total staff has been gradually rising year-on-year and cut to FY23, 74 per cent of the employees are categorised as officers with the proportion of clerks down to 26 per cent of total employees.

RBI, in its recent Currency and Finance report, also highlights the changing mix of banking staff in the last decade. In FY11, officers and support staff were at a 50:50 ratio and over the years this has slowly changed to 74 per cent -26 per cent in FY23.

Analysts and bankers note that the use of technology tools for routine tasks like KYC and documentation purposes is impacting workforce composition with a reduction in junior and middle-tier job roles and the need for most analytical and supervisory senior staff.

Balasundaram Athreya, President, Manipal Academy of BFSI, said that even though overall hiring at private sector banks is robust, the evolution of core banking systems and front-end fintech plays has led to relatively slower hiring for junior roles. “Many private banks are in the process of setting up business intelligence units that are staffed by senior professionals. Relationship managers too have become another key job role, requiring relatively experienced staff,” he said. The Academy trains and sends around 10,000 freshers to the private banking sector every year.

Employment Pattern

businessline’s analysis of bank annual reports shows that the trend is more pronounced in the case of nationalised banks. Nationalised banks face additional challenges in attracting junior talent compared to private counterparts. In the case of the State Bank of India, there was a 1.2 per cent fall in the headcount of officer staff from FY22 to FY24 but an almost 8 per cent dip in net headcount of clerks and sub-staffs. In the case of Canara Bank, there was a 3 per cent increase in officer count from FY22 to FY24, but a 9 per cent fall in junior staff during the same period. Net headcount of employees at Punjab National Bank has remained mostly flat across FY22, FY23, and FY24.

Private sector banks do not have a similar categorisation of staff in their annual reports but RBI data for private sector banks shows a 16 per cent rate of growth in officer staff in the private sector compared to a 3 per cent increase in junior staff. 

Krishnendu Chatterjee, VP and Business Head (BFSI) at Teamlease Services, says the banking sector has also been disrupted by contract staffing. “Digitisation cannot entirely do away with labour; banks are still hiring frontline sales, collections, and other staff but this recruitment is happening in special subsidiaries set up by large banks for operations support,” he adds. SBI, for instance, has an Outsourcing Services subsidiary called State Bank Operation Support Services (SBOSS).

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