To better understand the reasons for its continuous growth, we should understand the SWOT Analysis of Canara Bank, which is requisite for any business to survive and thrive in the market.
So without any further ado, let’s get started by learning about Canara Bank.
About Canara Bank
Canara Bank is one of the largest banks and the public sector bank owned by the Government of India. It is headquartered in Bengaluru in Karnataka. The bank was established in the year 1906 in Mangalore by Ammembal Subba Rao Pal and later the government nationalized this bank in the year 1969. In India, it has 6000 banking services.
The firm is now present in different countries as well. It also has headquarters in London, Hong Kong, New York, Dubai, Shanghai, Moscow, and Tanzania and it is under the ownership of the Ministry of India.
The bank is currently led by Lingam Venkata Prabhakar, who also serves as its CEO. It merged with Syndicate Bank on April 1, 2020, resulting in India’s fourth-largest public sector undertaking bank. It has 9 subsidiaries and 6 joint ventures under its belt, and it is in the process of becoming a financial conglomerate.
Now that you have an idea of what Canara Bank is, let’s look at the important segment of this blog – the SWOT analysis of Canara Bank.
SWOT Analysis of Canara Bank
SWOT analysis is a proven management framework that allows brands like Canara Bank to evaluate their performance to that of their competitors and the industry as a whole.
Canara bank’s SWOT analysis enables it to set a brand benchmark that is leading in the banking sector and the financial sector.
It’s an excellent tool for determining where the firm thrives and where it falters, designing countermeasures, and determining how the organization can expand. So, let’s look at Canara Bank’s SWOT analysis.
1. Strengths of Canara Bank
Strengths in SWOT analysis help in understanding the core area of the bank which helps beat the competition as a core competency of the business. Canara Bank teamed up with the United Nations Environment Programme (UNEP) to launch a successful solar loan scheme. The bank always introduced innovative schemes and it provides loans to the rural people at a very low cost and uplifts the standard of living.
In the upcoming sections, we’ll look at Canara Bank’s SWOT analysis framework.
- Schemes are by its very Nature Inventive – The bank’s schemes are extremely inventive. It offers low-interest loans to people living in rural areas, thereby contributing to the improvement of rural living standards by assisting farmers. It cooperated with UNEP to establish a solar lending program.
- The Method of Banking – Canara Bank, in comparison to other public banks in India, articulates best practices and provides a positive banking experience for consumers, resulting in a stronger brand image in the minds of customers.
- Employment Generation – Banks employ around 40000 individuals in India, resulting in a large number of people being employed.
These are the main services that Canara Bank provides to its customers, and that drive the company as a whole.
2. Weaknesses of Canara Bank
In this weaknesses section, we analyze the part of Canara Bank where the bank needs to work upon a particular area so that the firm is not behind in the race of competition. Just like every coin has two sides, the firm also has some weaknesses which may take the bank out of the market. One of the biggest weaknesses is the customer service is lesser than its competitors.
Let’s take a quick look at the weaknesses in detail.
- Poor marketing – As a nationalized bank in India, the marketing focus is relatively low, resulting in poor market visibility despite providing excellent banking services and experiences to consumers. The bank does not have a marketing department that concentrates on enhancing the bank’s market recognition.
- Poor Customer Service – India’s banking industry is fiercely competitive and the bank’s client service is one of its distinguishing features. Canara Bank has failed to provide excellent customer service. Customers are frequently dissatisfied with the way bank employees respond to inquiries and provide services. Furthermore, online banking services are not sufficiently established.
- Client Base Is Weak – The bank does not have a large number of high-income customers. As a result, low-income groups generate money, which does not enhance the bank’s bottom line, and hence growth is gradual.
If Canara Bank improves its customer service and if it becomes a customer-friendly public sector, it may tackle all other weaknesses easily. So, let’s have a look at the opportunities seized by Canara Bank in the upcoming section.
3. Opportunities of Canara Bank
This aids in determining what else a company can do with its current skills and resources. It enables the company to identify areas where it may expand and lead to diversifying the company’s revenue and consumer base.
Let’s see what are the opportunities grasped by Canara Bank.
- Rural Banking – The bank can go deeper into rural finance because the majority of Indians live in rural regions, and by meeting their banking needs, the bank can increase its revenue.
- Social Banking – In the age of social media, banks are using social channels to respond to the client’s requirements, posing a new challenge and saving time from having to visit physical banks.
Let’s find how Canara Bank is dealing with its risks now that we’ve learned about its prospects.
4. Threats of Canara Bank
Many private sector banks have come up with innovative schemes with a strong customer service base so it is one of the biggest threats for Canara bank. Because of competition or increasing the number of players in the market or industry with the same value prepositions directly indicates lower down in customer base and revenue of the bank.
Let’s have a look at the major threats of Canara Bank in the coming section.
- Private Sector Banks are Increasing Its Competition – Private sector banks are developing novel investment packages and thereby gaining market share among retail consumers.
- Economic Crisis – As a result of the economic crisis, clients are not saving money in banks, reducing bank liquidity and making it difficult to operate efficiently.
- Changing Policies – Banking policies are governed by Reserve Bank of India (RBI) laws and regulations, therefore any changes made by the RBI have a direct impact on the bank’s operations.
In this post, the challenges and solutions are presented in very simple terms.
With this, the SWOT analysis on Canara Bank comes to a close; in the next section, we’ll summarise the findings.
If Canara bank put focus on its strengths and tries to eliminate its weakness, it will become one of the leading government banks. The focus on expansion and innovation will help it a lot in growing. There is a huge potential market for the bank to capitalize on the new trends. The bank should focus on finding the reason behind western India and establishing in western areas as a leading banking and financial sector.
Canara Bank needs to focus on adopting strong marketing strategies or approaches to build a strong customer base to emerging economies is dramatically changing the banking industry across the world.
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