High staff churn in India's financial sector to persist in FY24- TeamLease exec

Teamlease Services

28/11/2023 09:21

By Savio Shetty
       Nov 28 (Reuters) - Soaring attrition in India's
financial sector will persist through next fiscal year due to a
demand-supply mismatch, a senior executive at TeamLease, one of
India's largest staffing services providers, said on Tuesday.
    HDFC Bank, India's largest private lender, saw its employee
turnover rate rise to 34% in the last fiscal year from 27.6% a
year earlier. At Axis Bank, it climbed to nearly 35% from 31.6%.
    Meanwhile, Kotak Mahindra Bank's attrition surged to about
50%, with smaller peer Yes Bank in tow at 43%.
    "The demand for salespeople (selling personal, home,
agriculture and other loans) is huge," Kartik Narayan, the chief
executive for staffing at TeamLease, told the Reuters Trading
India forum.
    These employees are underpaid and undertrained and a salary
hike of even 1,000 rupees ($12) per month is enough to make them
switch jobs, he added.
    Narayan expects this trend to continue, adding that
employment in the BFSI (banking, financial services and
insurance) sector is under "tremendous pressure", with frontline
attrition rates persisting at 30%-40%.
    Further, the central bank's measures to rein in unsecured
lending will not impact the sector's employment needs, he said.
    Earlier this month, the Reserve Bank of India tightened
norms for personal loans and credit cards, raising concerns
about a potential slowdown in loan growth.
    "I feel that (in the) immediate (future), perhaps there
won't be an effect," Narayan said.
    While the general staffing business is growing robustly,
tech staffing is going through a different cycle, he added.
    The hiring boom during the pandemic due to a sharp rise in
demand for digital products has now moderated. 
    "Some of this (tech hiring) is also cyclical and we do
expect it to start recovering in another two quarters," Narayan
said.
    
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 (Reporting by Savio Shetty; Editing by Sohini Goswami)
 ((savio.shetty@thomsonreuters.com;))