Equitas SFB is getting digital-ready
V.R. Sridharan, CTO, Equitas Small Finance Bank, discusses the technology initiatives in the bank and how it got transformed into a digital organization in a small period of time
Equitas Small Finance Bank completed an envious task of transitioning from an NBFC into a bank in a short span of 10 months and launch its operations in September 2016 as one of the first small finance banks in the country, thanks to its vision to create a best in breed technology landscape. The bank’s CTO, who was responsible for the creation of the technology infrastructure, V.R. Sridharan, says the goal was to set up a system, which leverages an open architecture enabling easy integration with other application platforms. “Equally important for us was to ensure information security and compliance to the regulatory environment. We wanted a technology setup, which would not only be comparable to the best banks, but also give us the competitive edge in our chosen customer segments,” says he.
This vision was pivotal in driving the information technology induction plans of the bank, says Sridharan, and adds this was accomplished in just about 10 months. “We have set up around 375 new bank branches in a record time of around 12 months as part of this journey. We have also made a significant capital investment in technology as part of this transition,” he adds.
CUSTOMER CENTRICITY IS CORE
Sridharan maintains that customer centricity and employee empowerment formed the core drivers of the IT team’s endeavor to create a state of the art technology setup. Scalability to meet the business growth, need to deliver change quickly to meet business demand and being future proof were the other key considerations in this technology journey and one of the significant features was setting up of an Enterprise Integration Layer as part of this transformation program, which enabled the core system to integrate easily with other external applications.
“The customer segments that we cater to on the lending side are the unbanked and the under banked. The intent, therefore, was to create a banking platform, which would leverage digital technologies in assisting them to have a banking experience that is simplified and hassle free,” he elaborates.
Which are the core areas that the bank had focused while initiating the technology transformation - digital as a whole, mobility, self-service, customer delight?
Responds Sridharan: “The intent when we commenced this transformation program was to ensure that the technology stack is able to deliver customer delight and convenience, which will enable the customer to access the bank anywhere, anytime. Customer centricity has been a key consideration in designing our digital offerings and we have adopted different approaches to suit the requirements of our diverse customer segments. With that outlook, even during the startup stage, we laid down our requirements to have a strong omni-channel presence. We not only strengthened our digital services to customers, but also enabled branches and executives with robust digital capabilities.”
He adds that creating a strong API layer has led to quick deployments on internet, mobile and tab offerings both on selfservice and assisted service capabilities. This has also enabled the bank to quickly integrate with its fintech partners.
SMAC A KEY CONSIDERATION
He reveals that SMAC (Social, Mobile, Analytics & Cloud) has indeed been a key consideration for the bank while initiating technology projects. In fact, mobility and cloud have become a fundamental wayof-work than an exotic requirement, he says, adding: “Our decisions on initiating technology projects go beyond these enablers, into the realms of user experience, automation, self-service, and being firstto-market. The world is moving from mobile-first to AI-first, and with our digital initiatives, we are now aligning our technology roadmap accordingly.”
Sridharan also talks about the bank’s strategy to have a mixture of off-the-shelf packages and internal development of applications to drive the business so that
there are tangible benefits. So, in order to enable faster turnaround times, the starting position has generally been that of ‘buy’, rather than ‘build’. “However, this comes with its own challenges and partner dependencies. Over a period, we have come to realize that one size won’t fit all. Hence, we believe that applications that are customer / agent facing which require a rapid pace of development and change are well suited to in-house development. Accordingly, last year, we took a bold decision to replace a critical COTS (Commercial Off The Shelf) product with an in-house application due to the challenges we faced with the delivery and support from the OEM. This application is used by our customer facing staff and implements complex workflows and decision trees. We are proud to have concluded its nationwide rollout recently and are confident that we can create in-house development capabilities where needed,” he reveals.
Sridharan says the bank has envisioned a goal of achieving digital leadership in the next 3-4 years, and as a part of this roadmap, it will focus on creating strong collaborative partnerships with fintechs. It is constantly on the lookout for partners who can add value in creating technology led products and services.
PAPERLESS, STRAIGHT THROUGH
Some of the key areas that the bank will continue to focus on are: becoming paperless and straight through, valueadded products and services to the SME clientele, building strong digital wealth management capabilities and process automations for improving efficiency of the backend operations.
“Innovation will be an integral part of our digital agenda in creating unique value propositions for the customer’” he says, giving out the example of the bank’s ‘Online Self-Service Account Opening’ capability using an interactive video form, which enables the customer to open a savings account in less than 6 minutes, a first of its kind in India.
The bank has become fully functional with self-service capability for its current, savings and deposit account customers and the facility is available both on the browser and as mobile banking apps on IOS and Android. A significant proportion of the bank’s customer base use it extensively to manage their accounts and payments.
Another service that the bank has been offering leveraging technology is the FasTag service. “We have been the first small finance bank to start issuing FasTag electronic toll collection tags enabling transit payments and are one of the few small finance banks to offer a wide range of payment products to our customers,” says Sridharan. “For example, we are a certified Payment Service Provider (PSP), which allows our customers to access their bank accounts through third party applications as well, using Unified Payment Interface (UPI).”
The bank is also constantly adding functionalities to its online and mobile banking offerings to provide greater customer convenience and delight. It is coming out with a centralized facial recognition capability for customer authentication on mobile banking.
Sridharan says the bank has already embraced emerging technologies like artificial intelligence, machine learning, robotics and cloud computing. “However, at the same time, we are of the view, that we will not keep chasing the latest technologies just to stay current. What is more important for these emerging technologies is to add value to our businesses – in areas such as customer experience and operational efficiency. Our investment decisions in these technologies will be dependent on the commercial viability as well,” he hastens to add.
While lot has been said about digital payments and cashless India, what is less discussed is the reliability of security systems for digitized banking. Sridharan says as the digital footprint of the bank increases, security within the digital environment becomes paramount for any organization. Security, he says, is more a journey than a destination, since it is something that will require constant enhancement to get ahead of the threats that exist in the digital world. “At Equitas, we place considerable importance on protecting our information assets. We set up a full-fledged information security practice within the organization much before we transitioned to a bank and have been constantly making the ‘right’ investments in both people and technology to ensure that our information security is best in class to protect the bank. We continue to keep this our top priority and have a team of security professionals who ensure that the bank is protected adequately,” says he.
Is there a plan to create a digital only service unit of the bank?
Responds Sridharan: “Equitas has made significant investments in its digital capability and will continue to do so in the coming years. The digital offering will complement the physical presence of the bank enabling a wide range of options for the customer to engage with the bank. We might consider certain products to be offered only through our digital platform, for certain specific customer segments who would be digital savvy.”
V.R. Sridharan emphasizes initiating technology projects go often into the realms of user experience, automation, selfservice and being first-to-market
Equitas mobile banking app