Private sector banks are facing a growing challenge with high turnover rates in their entry-level and sales teams, according to data compiled by TeamLease Services for The Economic Times. The attrition rates in areas such as loan and credit card sales have seen a sharp rise, more than doubling by the end of December.
TeamLease, which manages over 80,000 front-line employees in sales and customer care for both commercial banks and non-bank lenders, reported an overall attrition rate of 103%. This highlights the increasing difficulty in retaining talent in essential customer-facing roles. Non-bank financial companies (NBFCs) have also seen an annual attrition rate of 77%, while insurance companies report a rate of 62%.
Krishnendu Chatterjee, VP and business head at TeamLease Services, explained that high turnover is particularly prevalent in retail-facing roles like personal loans, credit cards, and other sales-related positions. The problem is most prominent among junior staff, who often switch jobs in search of small salary increases. “Their starting salary is around ₹15,000 a month, and even a modest ₹1,000 raise is enough to persuade them to move on,” Chatterjee said.
According to TeamLease, loan sales teams are experiencing monthly attrition rates of 9% to 13% in 2024. The Reserve Bank of India (RBI) is closely monitoring the situation. RBI data indicates that the average attrition rate in the private sector banking group for the financial year ending March 2024 was about 25%. Some banks have experienced even higher turnover rates over the past three years, with small finance banks seeing alarming attrition rates of nearly 40%, especially among junior management and front-line staff.
In response to the issue, RBI Deputy Governor Swaminathan J addressed private sector bank directors, acknowledging some improvements but stressing that much more needs to be done. “Attrition rates are not just numbers; they reflect deeper challenges in employee engagement and retention strategies,” he said. “Losing talented employees at the junior and front-line levels means losing valuable experience, customer relationships, and operational continuity, which can impact customer service and satisfaction.”
RBI has urged banks to focus on initiatives that promote career development, mentorship programs, competitive benefits, and a supportive workplace culture to help retain employees and reduce turnover.
