2018:Digital Directions & transformation
Banking Frontiers organized a round table on the theme ‘2018: Digital Directions and Transformation’ with senior IT professionals from banks and financial services institutions participating in the deliberations. Highlights:
Prasanna Lohar, Head-Technology Innovation & Architecture, DCB Bank: Hyper personalization will be the next big thing in the coming 2-3 years in the BFSI industry. Today, we are working in collaboration with different partners, but in the future, most of the things will be fast and automatic, and there will be fewer partners for carrying out digital activities.
The right digital architecture minimizes the gap to go into the market.
For checking the background of a customer for loan approval, there are alternate channels coming up apart from the CIBIL score like behaviour of the customer in different social media platforms. Brick and motor model will always be there, but there is a need for combination of online and offline platforms to provide efficient service to the customers.
BFSI institutions need to work hand in hand with fintech companies. In fact, the government of India is the biggest startup in the country. The government is supporting fintechs. In Maharashtra, the government has launched its fintech policy to support fintech companies, Andhra Pradesh government has launched Vizag fintech valley and other states like Gujarat are also helping the fintechs.
Fintech companies need to focus on beneficial activities for the country and overall industry. There is big gap between India and other countries in adoption of fintech technology. Startups have an edge over big IT companies like Infosys, Microsoft and Accenture.
The companies are hiring specialized persons for security related functions and ethical hackers to do the testing. Hiring employees with good digital skills is challenge for most of the companies.
The rescaling of existing resources and manpower are also important. Digital transformation is good for India the digital India movement will bring new things and new business models will create more jobs in the coming years.
Rishi Aurora, Managing Director Financial Services, Accenture in India: Accenture has been in the forefront of digital transformation in India. For us, digital means customer and data. Organizations which understand and analyze the data and use it for specific personalized campaigns are the successful organizations. Based on structured and unstructured data,
companies can customize their campaigns. Digital transformation is a very important aspect for banks and NBFC in India.
Sonali Kulkarni, Managing Director, Accenture Consulting: Customers, enablers, regulators, government and system partners like fintech players have contributed to the growth of digitization in India’s financial sector. BFSI companies should be able to use the unstructured data to make personalized offerings to the customers. Banks should design processes that are automated and that do not need any human intervention. The person who gets impacted most due to the digital transformation is the employee of the organization. It is difficult for bigger organizations to adopt the technology changes due to the legacy issue from the technology prospective, especially the digital changes.
Anand Pejawar, President Operations, IT & International Business, SBI Life Insurance: Recently SBI Life Insurance has launched UNO, or ‘U Need Only One’ an app using which customers can do banking transactions, life and general insurance transactions, mutual fund and credit cards transactions. They can also do the shopping with the app.
Marketing is a science and digital is going to help marketing in a very big way. SBI Life Insurance is the only company in India, which has introduced a multilingual website – the content is in fact in 9 languages and viewers can convert the website as per their requirement. We have also introduced our chatbot ‘Riya’ which is a text-based platform. We will make Riya voice-enabled soon and integrate Alexa on this platform.
Suresh Shanmugam, Head Innovation & Future Technology business information technology solutions, Mahindra & Mahindra Financial Services: There is need for BFSI institutions to move from corporate digital to personal digital. After demonetization, there is rise in the money lenders’ business. They are providing loans in 1 minute and their business model is progressive in nature. In rural India, there are banks, financial institutions and regulator on one side, and customers on the other side. The rural customer pays commission to the agents, brokers and other intermediaries for any loans. The digital channels may not be viable and effective unless the interference of the middle man is stopped. For targeting rural India, companies need to capture the emotions of the people. They need to develop behaviour-based authentication and applications.
K. Suresh, SVP - IT, Tata AIG General Insurance: Insurance products are mainly force driven, but this trend is changing in the last 3-4 years. In future, there will be demand for term insurance among the customers. In the past, we had introduced telematics service in motor and health insurance products. There is OBD device installed in cars and based on the usage of the car, the insurance premium gets calculated. Similarly, for health insurance the insurance premium gets calculated depending on how much the person walks.
Biswabrata Chakravorty, CTO, IndusInd Bank: IndusInd Bank does not invest in technology heavily. We invest in technology as per our business requirements. We are working on both private and public cloud set-up. We are also moving to open source, and we have appointed a steering committee to review and measure all the IT expenses. Recently, Bharat Financial Inclusion merged with us and this entity is now a completely digital enabled company. We are trying to move to enterprise warehouse model to provide convenience to our customers.
K.R.C. Murty, Group CIO, Deutsche Bank: There are many digital solutions available, but they are not cheap. Fintech companies in India needs to understand their competitors and partners and the way ahead for them. Deutsche Bank has developed internal chatbots for providing suggestions with regards to work processes and operations.
Vijay Raghavan, SVP - Risk Management & Fraud Monitoring: Industry needs people with higher calibre to do the job rather than depending on the machines.
Rimpi Bhatia, Chief Manager, ICICI Prudential Life Insurance: Digital marketing is the way forward and ICICI Prudential is into it. Buying of an insurance policy should be as quick as we are purchasing a fixed deposit plan online.
Bhaskar Jutti, CIO, SBI Life Insurance: Life insurance companies in India have 1% to 0.5% of the GWP and in the last few years we have seen an increase. There is a wide range of difference in the investment pattern of life insurance companies in digital technology. Some companies are investing huge amounts, and some are not. Some of the companies like us are investing in technology without thinking about ROI. More than ROI, we look after the ratio of the IT spends. We have fast track approval process for adoption and approval of new technology.
Rahul Purandare, DVP - Product Management, IDBI Federal Life Insurance: Customisation increases the cost to the company. Customers in banks and insurance companies buy the products differently. They first buy the company than the product. Things like trust and convenience are important for the customers. We need to identify the areas in which customization needs to be done effectively and at low cost.
Panel discussion in progress
Panelists debate a point