In absence of access to formal sources of finance, the alternate cost of funds for the people is exorbitantly high. As the pricing of loans no longer remains restricted due to any regulatory/ government fiat, the banks are free to reasonably charge their customers. All this means that the retail banks have a huge potential to grow in India over time.
I believe that the other jurisdictions represented here also face similar conditions in their respective countries. I would, therefore, argue that the challenge for the retail banks is not finding new customers or new markets; it is more of a mindset issue.