Analysis of Technical Efficiency of Private Sector Banks in the era of Digitalisation

Authors

Garima Dudeja, Research Scholar
Department of Economics, Kurukshetra University, Kurukshetra.

Dr. Archna Chaudhry, Assistant Professor
Department of Economics, Kurukshetra University, Kurukshetra.

Abstract

Efficiency should be the main concern of commercial banks. The present paper analyses the efficiency scores of 19 Indian private sector banks using the output oriented Data Envelopment Model for Variable Returns to Scale. The main objective of the study is to compare the efficiency scores for pre and post period of launching of Digital India Campaign and due to which the study is done over the period of 2010-11 to 2019-20. The input and output variables are selected as per the intermediation approach in which deposits, borrowings and operating variables comprise the inputs where as investment and advances are the outputs. The result indicates the inconsistent improvement in efficiency scores in post digital period. Also slacks measurement is done to find out the area of improvement and from the whole estimates it could be suggested that private banks are required to cut their operating expenses and should focus on more investment incomes.