LVB to strengthen its re­tail busi­ness

Peeush Jain, SVP, head – Re­tail Bank­ing, Lak­shmi Vi­las Bank, speaks about the bank’s plans to ex­pand oper­a­tions and re­al­ize tar­gets:

Banking Frontiers - - Highlights - Mo­han@bank­ingfron­tiers.com

Peeush Jain, SVP, head – Re­tail Bank­ing, Lak­shmi Vi­las Bank, speaks about the bank’s plans to ex­pand oper­a­tions and re­al­ize tar­gets

N. Mo­han: Lak­shmi Vi­las Bank is one of the old gen­er­a­tion pri­vate banks that has been able to of­fer an ap­pre­cia­ble level of ser­vice to the cus­tomers in spite of sev­eral con­straints, com­pe­ti­tion be­ing a ma­jor one. How do you han­dle this com­pet­i­tive en­vi­ron­ment? Is the strat­egy fo­cused on better cus­tomer en­gage­ment or on de­vis­ing prod­ucts and ser­vices that tar­get niche cus­tomer needs? Some ex­am­ples?

Peeush Jain: At Lak­shmi Vi­las Bank, we adopt a multi-pronged strat­egy to keep pace with com­pe­ti­tion. The tra­di­tional re­la­tion­ship model is ex­tremely valu­able for the bank and has yielded good re­sults over time. Nev­er­the­less, to keep up with the times, we have been con­stantly de­vis­ing new of­fer­ings and up­grad­ing ex­ist­ing prod­ucts and ser­vices too. In re­cent years, we have brought out our own ‘CROWN’ prod­ucts for HNI and NRI clien­tele. Our mo­bile app as well as our pay­ments app, Upaay have gained pop­u­lar­ity. More­over, are of­fer­ing very com­pet­i­tive in­ter­est rates on both de­posits and ad­vances.

Can you out­line de­tails of some of the unique prod­ucts and ser­vices that you have on of­fer?

We have a suite of prod­ucts to cater to var­i­ous cus­tomer seg­ments. Some of our most pop­u­lar prod­ucts are our ‘CROWN’ prod­ucts for HNI and NRI cus­tomers, wherein we of­fer mul­ti­ple ben­e­fits to ac­count hold­ers, Cur­rent Flexi ac­count with a lot of flex­i­ble fea­tures, VYAPAAR cur­rent ac­count, which is a zero bal­ance ac­count for small traders, Lak­shmi Busi­ness Credit, a sim­pli­fied struc­tured prod­uct for busi­ness­men, Lak­shmi Loan against prop­erty, a mort­gage based prod­uct for re­tail and MSME cus­tomers and Lak­shmi Com­mod­ity Power, which is a loan against pledge of agri­cul­tural com­modi­ties.

Where do you think you have been able to make a dif­fer­ence?

Ba­si­cally, we make a dif­fer­ence in the way we treat our cus­tomers. This is done by: a) In pro­vid­ing per­son­al­ized ser­vice b) In pro­vid­ing prod­ucts to suit spe­cific

needs of var­i­ous cus­tomer groups c) In be­ing flex­i­ble enough to take care of cus­tomers’ var­ied re­quire­ments in their deal­ings with us. No won­der our cus­tomers are very loyal to us and we are reck­oned as a bank ‘Trusted Across Gen­er­a­tions’

What are the bank’s plans to grow out­side the south­ern states?

We have a sig­nif­i­cant pres­ence out­side the south­ern states. We are oper­at­ing in 17 states, in­clud­ing Tamil Nadu, and 2 Union ter­ri­to­ries. Out of a to­tal of 548 branches, 74 branches are lo­cated in states out­side of the south, as of 31 March 2018. It is our re­solve that we will con­tinue to grow in non-south­ern states.

The bank has a whole lot of focus on fi­nan­cial in­clu­sion. Can you identify some unique ini­tia­tives?

We have 228 busi­ness cor­re­spon­dents oper­at­ing in 133 vil­lages and 230 wards (ur­ban ar­eas). We have achieved the tar­gets al­lo­cated to us un­der the gov­ern­ment’s fi­nan­cial in­clu­sion plan. We have also opened 184,018 Jand­han ac­counts.

There are MFIs ac­tive in ar­eas where banks do not have a strong pres­ence. Do you in­tend to lever­age such MFIs to strengthen your mi­cro­fi­nance port­fo­lio?

Yes. We have adopted a cau­tious ap­proach here but have al­ready be­gun en­gag­ing with MFIs. Over time, we ex­pect this to gather fur­ther mo­men­tum.

Do you in­tend to ex­pand your branch net­work? Or do you plan to focus on lever­ag­ing tech­nol­ogy to gain better reach? Can you give de­tails of the tech­nol­ogy ini­tia­tives in this re­gard?

We have grown its branch net­work sig­nif­i­cantly over the last 3 years. As on 31 March 2018, we had 548 branches and 1020 ATMs and eLounges. It is our re­solve to con­tinue to look at grow­ing the branch net­work but this ef­fort would in­creas­ingly lean on tech­nol­ogy to fur­ther busi­ness. The branches them­selves would un­dergo a change in look and feel as more self-ser­vice op­tions would be pro­vided to cus­tomers. Some of these are al­ready show­cased at our eLounges.

How pre­pared is the bank tech­no­log­i­cally? What mile­stones in tech­nol­ogy have been ac­com­plished re­cently and what are the

plans for the next two to three years?

We of­fer all the ba­sic tech­nol­ogy-based prod­ucts that cus­tomers pre­fer like debit cards, in­ter­net bank­ing, mo­bile bank­ing, UPI pay­ment app – Upaay -, Bharat QR, ATMs, POS ma­chines, CDMs, eLounges etc. We will shortly in­tro­duce pre­paid cards, gift cards and forex cards. We are also up­grad­ing our CBS soft­ware, which is ex­pected to bring in fur­ther im­prove­ment in the dig­i­tal of­fer­ings.

Where do you see your­self in the dig­i­ti­za­tion ini­tia­tives in the bank­ing sec­tor?

Cur­rently, we are more or less at par with al­most all other sim­i­lar banks in dig­i­ti­za­tion ini­tia­tives. Our in­ten­tion is to reach the next level in the next 2 to 3 years.

Have you un­der­taken any BPR projects that are aligned with tech­nol­ogy?

We have been re­jig­ging our busi­ness from time to time. At the present mo­ment, the focus is on a cru­cial core bank­ing sys­tem up­grade, which should add a very sharp edge to our prod­ucts and ser­vices pro­file, on com­ple­tion.

What are the turnover tar­gets for the com­ing 3 years? What cus­tomer seg­ments will fuel most of the growth?

We hope to dou­ble our busi­ness over the next 3 years. The cor­po­rate bank­ing has, thus far, been the main en­gine for growth. How­ever, in­cre­men­tally, the growth, going for­ward, would be more in re­tail and MSME seg­ments.

Would re­tail con­tinue to be a focus area? Are you in­tend­ing to cut down your cor­po­rate loan port­fo­lio? If so, what will be the strat­egy for fund­ing MSMEs?

Our ba­sic foun­da­tions lie in re­tail and MSME bank­ing. Over the last few years, the focus might have shifted, but we are now looking at strength­en­ing our moor­ings in the re­tail seg­ment, as we aim to lower our pro­por­tion of cor­po­rate ex­po­sure. We have a strong af­fil­i­a­tion with the MSME sec­tor and this is be­ing now re­newed with vigour. The focus is on strength­en­ing re­la­tion­ships with timely in­ter­ven­tions.

The bank is also one of the few pri­vate banks that of­fer full-fledged wealth man­age­ment ser­vices. Can you give an in­sight into the ser­vices of­fered?

In keep­ing with our com­mit­ment to pro­vide the en­tire range of prod­ucts and ser­vices to our cus­tomers, we of­fer wealth man­age­ment ser­vices through our part­ners and al­liances. These in­clude on­line of­fer­ings.

With debit card is­suance on the rise, what is the bank’s plan for the next 24 months to in­crease its POS roll­out?

We had in­creased our POS strength from 5422 POS out­lets to 6342 dur­ing the last year. Dur­ing the next 24 months we in­tend to take this fig­ure to 15,000.

What are the plans for ATM ex­pan­sion? What new ser­vices are likely to be of­fered on the ATM chan­nel in the near fu­ture?

As of now, we have 1020 ATMs. ATMs along with cash de­posit ma­chines will see in­creas­ing us­age and we ex­pect to sig­nif­i­cantly grow our net­work over the next few years. These will form a part of the bank’s over­all pay­ments strat­egy, in­clud­ing UPI, IMT and var­i­ous Aad­haar en­abled op­tions.

Peeush Jain ex­plains that Lak­shmi Vi­las Bank makes a big dif­fer­ence in the way it treats its cus­tomers, es­pe­cially pro­vid­ing per­son­al­ized ser­vices

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