HSBC Holdings Plc is testing a range of new products and services as part of its push to win a larger share of business from India’s affluent diaspora, who sent more than $100 billion back home last year.
The bank plans to offer dollar-denominated products to non-residents from India’s low-tax financial hub, according to people familiar with the matter. The offerings in GIFT City could include savings accounts, insurance, fixed income and other investment products, the people said, asking not to be identified discussing private information.
HSBC also opened a virtual experience center in the metaverse for non-resident Indians this month. The metaverse, accessed through virtual reality headsets or QR codes on smartphones, allows customers to have their own avatars and explore credit cards, banking products and investments, the people said.
HSBC didn’t respond to requests seeking comment.
More than 32 million Indians reside outside the country — almost matching the population of Malaysia — largely across North America, the UK, and Middle East, according to data from the Ministry of External Affairs. Wealth managers like HSBC, Barclays Plc and UBS Group AG are also trying to grab a share of business from this largely affluent cohort.
Remittances to India from non-residents reached $112.5 billion in fiscal 2023, up from $89.1 billion the previous year, according to the Ministry of Finance. More of the affluent NRIs, as they are known, are looking to invest in the country’s growing economy using US dollars, the people said.
Banks are turning to Gujarat International Finance Tec-City, or GIFT City, to build out their offerings to non-residents. GIFT City, north of Mumbai in the home state of Prime Minister Narendra Modi, offers exemptions from the many rules and taxes that are seen to hamper business and trading in India. Modi’s goal is to create a wealth hub alternative to Dubai, Mauritius and Singapore, and advisers are exploring ways of using it to attract capital from India’s diaspora.
The metaverse move “aligns with our commitment to serve global Indians through every touch point,” Sandeep Batra, head of wealth and personal banking for HSBC in India, said in a recent LinkedIn post.
According to Batra’s post on LinkedIn, the virtual bank features an amphitheater, premier lounge, beyond banking zone, overseas education lounge and NRI oasis.
The experience currently lacks transaction capabilities, which could be built as more products are developed, the people said, adding the offering is aimed at younger customers.
HSBC last year hired a senior private banking executive from UBS, where he ran a team serving wealthy Indians overseas. The country’s growing wealth management industry could be worth $5.5 trillion by 2025, according to Bloomberg Intelligence analyst Sarah Jane Mahmud.
