IBS Journal July 2017
33
ascertain exactly how successful this step will be. It can be considered a bold step in the drive to shift the Indian economy towards a “less-cash” and eventually a “cash- less” model.
From a lending perspective, the technology exists for banks to provide their customers with high quality, seamless, mobile experiences across the entire loan lifecycle – from onboarding to collections. The use of mobile in origination can help transform the onboarding experience with anytime anywhere loan application capabilities. Mobile based loan servicing provides customers with the ability to quickly and easily make loan repayments without needing to visit the branch. Mobile based collections can help reduce the risks associated with float money, enhance transparency with real-time updates and improve efficiencies in what has previously been a largely manual operation.
With demonetisation set to give a huge boost to digitisation in banking transactions, the stage is set for banks to extend this capability quickly to all customer facing areas including lending.
Will the embracing of digital services by the Indian government be a boon for banking vendors such as yourselves?
While demonetisation will increase digitisation, let’s not forget that India is a country where 97% of transactions by volume still happen with cash. Age-old cash habits could act as a strong deterring factor, especially now when cash is back in circulation, and the effect of demonetisation is fading. Both government and private players should keep consumers motivated to use cash-alternative payment instruments. The Indian government has already announced a series of incentives – from free insurance to discounts on digital payments – which will continue to boost consumer motivation to become and remain cashless.
By increasing the number of people who have access to formal banking services digitisation will provide banks with a greater market for credit. Previously many of these unbanked people were forced to use informal sources of credit due, so it can be expected that this segment will provide a source of credit growth for banks. Also, when the banked population starts using digital services offered it can be a strong case for banks to offer the right loan products on the digital platforms of choice- leading to new business.
What systems are you implementing?
FinnAxia is an integrated global transaction banking suite that offers the capability to address corporate customer’s liquidity management needs swiftly and provides end-to- end solutions from receivables, payments and liquidity management to financial supply chain management, which ensure working capital optimisation. This solution helps financial institutions establish and maintain market-leading positions through the flexible, speedy and efficient execution of transaction banking processes. With Nucleus FinnAxia, one of the largest banks in Europe saw a 300% increase in their customer base. A leading bank in the Middle East recoded a 66% reduction in processing time, a bank in India saw a 250% increase in customers, volume and value, and an African Bank recorded a 33-fold growth in payment transactions processed in the first six months.
PaySe is the world’s first offline digital cash solution that allows users to conduct transactions using digital currency. PaySe has been developed to address the requirements of citizens at the bottom of the pyramid. Not only does it have the capability to facilitate online withdrawals and deposits but also enables completely offline usage, just like cash.
What technology trends do you see taking over the banking technology world in 2017 and beyond?
At one extreme we see banks which refrain from technology refresh and at the other extreme we see banks that are creating new digital banking offshoots which do not have any of the limitations imposed by legacy technology. However, banks need to realise that the only way to create a ‘bank of the future’ is to strike the right balance between the two options. Banks need to choose the right technology partners who can help them offer new capabilities while co- existing with the legacy systems until they are ready to pull the plug completely.
Previous technology waves have often traded on hype, using the cool factor or fashion to drive adoption. This has led in some cases to disappointment, what Gartner refers to as the trough of disillusionment. Business leaders need to carefully evaluate new technologies before deploying them. Before getting carried away by the hype they need to ask traditional questions – will this help me to deliver a unique proposition to my customers? Will this new technology fit in with my existing processes? Will my people need to be retained? Will this enhance my customers’ experiences? Above all will this deliver the return that I need?
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