India, May 22 -- Banks will have to compete on the quality of the customer experience to remain relevant and physical branches will continue to play a strategic role, evolving into phygital advisory hubs that blend digital tools with human reassurance, EY India said in a report.

The EY report 'Customer Experience Reimagined: The New Frontier for Indian Banking in 2026' also said that banks are no longer judged only on how seamlessly customers can transact, but on how intelligently and intuitively they anticipate needs, simplify decisions and deliver support at the exact moment it matters.

"This future will be shaped by a partnership between people, AI agents and phygital touchpoints, all working together to create experiences that feel ...