The usual link between growing the business and growing the physical footprint has broken, according to Sanjiv Chadha, MD CEO of Bank of Baroda. Chadha says the mobile channel is the bank for sourcing, distribution, and servicing.
Chadha gave an example of the public sector bank's growth by 35 -- 40 per cent in the last three years, but the number of branches has gone down by 15 per cent and staff has not grown at all. He adds that enormous operating leverage can be created through technology if you get your act together.
Vaidyanathan, CEO of IDFC First Bank, says that growing credit is easy, but the role of technology is to enable a seamless experience, reach out to underserved people, and build a quality portfolio.
Dinesh Khara, Chairman of SBI, says that what we see on the face is the customer's convenience, but there are other elements like the risk and payback period. Khara was among the panelists at the IBA seminar on banking technology today.
AK Goel, MD CEO of Punjab National Bank, touched on the issue of technology creating affordability for the masses. IDFC First s Vaidyanathan pointed out that one of the biggest paradoxes of banking is that the poorer you are, the higher the interest rate you end up paying. The big role technology can play is to reduce the cost of operations at the bottom of the pyramid, says Vaidyanathan.
The foreign bank spent more than 12 billion dollars last year, which is more than the size of many tech companies, according to PD Singh, CEO of JP Morgan Chase Bank. That's how important technology has become, says Singh.
The largest bank has created a new cadre within the bank in terms of IT skills and talent.
Khara says that we are hiring IT talent from the market. The SBI has made a senior lateral hire in Nitin Chugh, the deputy MD and head of digital banking. Chugh previously served as CEO of the Ujjivan Small Finance Bank and as the digital head of the private sector HDFC Bank.
Chadha says that the technology partner could help you bring a change to the organisation, but embedding the change doesn't come easily. That is a fundamental change according to Chadha, because bringing in talent and allowing it to grow.