The Indian banking sector has witnessed dramatic changes in the early 1990s. Consequently there has been a drastic transcendence from a traditional banking approach to a client-oriented banking approach. This resulted in a steep increase in the competition leading all the players in the banking sector to become more market-driven and market-responsive.

The heightened competition and versatility in the institutions has made both the corporate and the retail clients become more choice-based and product-oriented towards the banks. This has also made the customers turn less `loyal' towards a particular organization. In the current scenario, when the banking sector has reached its saturation limit, addition of new clients to the crew and retention of existing ones is posing a tough challenge to the players of the banking sector.

Replications of products has forced them to provide nearly identical services; only to distinguish themselves on the basis of price and quality and the choice is only left to the discretion of customer. Therefore, the customer-centric model of banking has to be extensively exploited for strategic advantages and for survival in ever-increasing banking competition. The customer-centric business model involves two key criteria –customer data management and customer relationship management.

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