Indians working abroad have realised their homeland is the second-fastest growing economy in the world. The potential returns have fuelled a demand for online banking services that will allow them to access these markets. That, Rana Kapoor says, is where his bank, the newest in India, comes in.

Mr Kapoor is the managing director and chief executive of Yes Bank, the first bank to be established in India in a decade. He is also an web enthusiast. He aims to "internetise" his entire business.

"This, we believe, will help us provide better service, acquire customers quickly and transcend geographies," he says. This week Yes launched an internet-enabled "Global Indian Banking"service, which allows customers to instantly transfer money to banks in India.

"The value of such services will greatly serve the Indian diaspora," Mr Kapoor says. "Sitting here in London, a non-resident Indian can make payments to his family members in a small village in India – instantly."

In India's corporate sector, he adds, there is a "huge demand" for internet banking services.

Mr Kapoor's approach has already been successful. In a vast country where digital communications have fuelled a thriving industry based around outsourced work from the west, Yes is being touted as a standard bearer of what it calls "Emerging India".

The bank turned profitable within 12 months of starting operations in August last year and its initial public offering in June was oversubscribed 30 times. Yes posted net profits of Rs255 million (£3.3m) for the first half of fiscal 2005-06 on a gross income of Rs743m. As of September, its loans stood at Rs13.46bn and deposits at Rs11 billion.

Analysts have hailed the performance as "spectacular" for a private Indian bank setting off from a standing start, and have pointed at the pedigree of its founders, Mr Kapoor and Ashok Kapur, Yes's non-executive chairman. The men were responsible for setting up Rabobank’s operations in India and the the Dutch private banking group now owns nearly 16 per cent of Yes.

Mr Kapoor says that much of Yes’s success rests upon its developed of "an advanced internet banking platform" which enables a customer to securely conduct most of his banking through his desktop.

"Our integrated services offer a corporate, business banking or an individual customer a single view of his relationship with the bank across all the products he may own."

Apart from the non-resident Indian (NRI) and corporate markets, Yes is also looking at retail banking and India’s rapidly emerging middle class.

The majority of the India’s 1 billion citizens may not yet have benefited from India's slow-burning economic revival - a poor monsoon still spells disaster for many. But the National Council for Applied Economic Research (NCAER), a New Dehli-based research organisation, estimates that there are about 200,000 "affluent households" in India. These households, with annual incomes of between Rs2.5 million (£32,000) and Rs5 million (£64,000) a year, represent the sort of clients that are likely to manage their money online.

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