When an existing customer is offered and sold ancillary / additional services it is cross selling. Cross selling is taken as a transaction based activity but more as a relationship building exercise by the banks.
Serving an existing customer is a low cost affair than serving a new customer.
Better leverage of of the available resources and existing clientele base.
Improvement of the Brand value.
Retail Banking has in recent years emerged as a rapidly growing opportunity for bankers all over the country. The Banks are lured by the low cost retail deposits which are more stable in comparison to the corporate deposits.
Apart from that, the retail loan products such as home loans, commercial vehicle loans, two wheeler loans, personal loans, credit cards, loan against time deposits and shares are becoming popular. The smaller value personal loans provide banks a wider margin spread.
The Credit Card Business has now-a-days become an important component of lending to the retail segment.