EDUCATION SECTOR

India holds an important place in the global education industry. India has one of the largest networks of
higher education institutions in the world with 850 universities (as of April 2018) and 42,026 colleges. A
total of 35.7 million people were enrolled in higher education institutes in 2016-17. Moreover, the aim
of the government to raise its current gross enrolment ratio to 30 per cent by 2020 will also boost the
growth of the distance education in India.

The education sector in India is poised to witness major growth in the years to come as India will have
world’s largest tertiary-age population and second largest graduate talent pipeline globally by the end of
2020. The education sector in India is estimated at US$ 91.7 billion in FY18 and is expected to reach US$
101.1 billion in FY19E.

Higher education system in India has undergone rapid expansion. Currently, India’s higher education
system is the largest in the world enrolling over 70 million students while in less than two decades, India
has managed to create additional capacity for over 40 million students. By 2025, the segment is
expected to reach US$ 35.03 billion.

The country has become the second largest market for e-learning after the US. The sector is expected to
reach US$ 1.96 billion by 2021 with around 9.5 million users.

In 2025, it is estimated that India’s higher education will:

 Adopt transformative and innovative approaches in Higher education.

 Have an augmented Gross Enrolment Ratio (GER) of 50 per cent
 Reduce state-wise, gender based and social disparity in GER to 5 per cent.
 Emerge as a single largest provider of global talent, with one in four graduates in the world
being a product of the Indian higher education system.
 Be among the top 5 countries in the world in terms of research output with an annual R&D
spent of US$ 140 billion.
 Have more than 20 universities among the global top 200

Education infrastructure is expected to remain the key focus in the current decade. In this scenario,
infrastructure investment in the education sector is likely to see a considerable increase in the current
decade.

INDUSTRY: CURRENT SCENARIO

With the growth in the Indian economy expected to be strong for quite some time-especially in its
services sector-the demand for banking services, especially retail banking, mortgages and investment
services are expected to be strong. The IT revolution has had a great impact on the Indian banking
system.

Cases of students defaulting on loan payments prompted Indian Bankers Association to review the
education loan scheme. The Indian banking sector began giving education loan from 2001 onwards.
With the Take-over Education Loans, you can switch your existing high cost Education Loan to the bank
and reduce your monthly EMIs. Loan can amount upto Rs. 1.5 Crores.
OPPORTUNITIES

 Developing countries like India, still has a huge number of people who do not have access to
banking services due to scattered and fragmented locations. These locations has huge
candidates for loans because the potential students cannot pursue higher education due to
money constraints especially in these remote areas. Here lies the scope for banks to expand its
services through market penetration.
 With the rise in level of services due to the emergence of Information Technology and
competition emphasis on new trends like skill loan and take-over loan can create new
opportunities due to the market demand.
 Small and local banks face difficulty in bearing the impact of global economy therefore, they
need support. One solution for it could be a merger.

RECOMMENDATION:

 Since the biggest challenge for banking industry is to serve the mass market of India. Companies
have shifted their focus from product to customer. The better we understand our customers,
the more successful we will be in meeting their needs. In order to mitigate above mentioned
challenges Indian banks must cut their cost of their services.
 Another aspect to encounter the challenges is product differentiation. Apart from traditional
banking services, Indian banks must adopt some product innovation so that they can compete in
gamut of competition. Technology up gradation is an inevitable aspect to face challenges. The
level of consumer awareness is significantly higher as compared to previous years. Now a days
they need internet banking, mobile banking and ATM services.
 Expansion of branch size in order to increase market share is another tool to combat
competitors. Therefore, Indian nationalized and private sector banks must spread their wings
towards global markets as some of them have already done it. Indian banks are trustworthy
brands in Indian market; therefore, these banks must utilize their brand equity as it is an
valuable asset for them.