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NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
Vol. 20 No. 8 December 2021     `75
                                                       Pages 56

                            Turtlemint                       pg 6
                            Indian Bank                      pg 14
                            Future Generali              pg 24
                            JM Financial                 pg 33
                            NABARD                       pg 38
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NBFCs DRIVE
DIGITAL
TRANSFORMATION
ON MULTIPLE FRONTS
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
KNOWLEDGE PARTNER

                                            Presents

                  BANKING FRONTIERS

                                                                               2022
                                    THEME
                            INNOVATE TO ACCELERATE

                       Virtual Summit l 6th March 2022

The Pandemic aftereffects are slowly fading and the economies are
rising. There is a new optimism in the air, newer opportunities.
Organisations are now stepping up the gas on growth by hiring
more, investing more and experimenting more.
One of the most important boon is the quick transformation
into the world of digital. The world of remote meetings, remote
events, remote customer onboarding, servicing and the
acceptance to a world of digital possibilities and innovations.
It is in the midst of these possibilities that Banking Frontiers
presents its 11th Finnoviti and 8th Technoviti Awards and
Conclave 2022 with the Theme: Innovate to Accelerate.
This is going to be a two-day conference which will be
followed by the Technoviti Awards on Day 1 for Financial
technology and Fintech innovations and Finnoviti Awards and
Conclave for Financial Services and Technology Innovations.
Innovate to Accelerate will cover interesting themes around:
Ecosystem building, Global expansions, Digital Acceleration,
Investments, Trending technologies and much more.
Join us in Co-creating, Co-innovating and Rediscovring the growth of the financial
services which is accelerating itself to newer growth trajectories. Join the Finnoviti &
Technoviti 2022 conference, Share your nomination with us, meet up with your potential partners
and customers and Engage, en-roll and transact. In short with Finnoviti, Technoviti the twin carnival
of innovations, you can Innovate to Accelerate.

                             Call for Nominations!
                              For details contact us
                              ASHISH VERMA +91 - 98332 36943 ashishverma@glocalinfomart.com
                              STALIN SALDHANA +91 - 91677 94513 stalinsaldhana@glocalinfomart.com
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
Editor’s Blog
                                                                    Manoj Agrawal
                                                                    Mobile : 98673 66111
                                                                    Email : manoj@bankingfrontiers.com

December 2021 - Vol. 20 No. 8
Group Publisher     : Babu Nair
Group Editor        : Manoj Agrawal          2022 could be a
Editor

Editorial
                    : N. Mohan

Mehul Dani, Ravi Lalwani, Aditya Arya
                                             glorious year
                                             T
Research Editors                                     hroughout the year, I have written about business and technology and risk
V. Babu, Ratnakar Deole,                             and compliance and more. Since this is the year end, let me look at people in
W.A. Wijewardena, Sanchit Gogia,                     this final edit.
K.C. Shashidhar, Dr L.S. Subramanian,             2021 has no doubt
Ajay Kumar                                   been a disaster in
Advisor-Alliances                            many ways for many
Ateeq Siddique                               people. Without
Marketing                                    dwelling further, I
Kailash Purohit, Wilhelm Singh,              also observe that it has
Dhara Thobani, Rohit Kahar,                  been a tide that has
                                             lifted many people.
Events & Operations
Shirish Joshi, Stalin Saldhana,                   The talent demand has grown dramatically during the year, especially in some
Pramod Jadhav, Ashish Verma,                 key areas like cybersecurity, data science, machine learning, payments, open
Ramesh Vishwakarma,                          banking, risk management and many others. All these areas have experienced a
Sushant Tulapurkar                           rapid level of growth and transformation, which is being powered only by human
                                             intellect. This tide has lifted those who are already in these areas and those have
Design
Somnath Roy Choudhury,                       joined in recently.
Sudarshan Herle                                   Another interesting development is that more and more people are going
                                             ahead and doing short term courses to augment their knowledge and advance
Published By
                                             their careers. I see more and more posts on Linkedin where people post what new
Glocal Strategies & Services
                                             course they have done and got certified. This is a good indication that there will
D-312, Twin Arcade, Military Road, Marol,
Andheri (E), Mumbai 400059, India.           not be a situation of an extreme talent crunch in the years ahead. For institutes
Tel: +91-22-29250166 / 29255569              and organizations offering such courses, this a fertile ground. Banking Frontiers
Fax: +91-22-29207563                         too offered a couple of master classes on AI in Financial Services. We hope to scale
                                             up these master classes further in 2022.
                                                  One area where most large financial organizations are hiring is at the frontline.
Printed & Published by Babu Nair on          Organizations that have a large customer base and are looking to expand further,
behalf of Glocal Strategies & Services and   are boosting their fontline workforce to acquire new customers and to cross-sell
Printed at Indigo Presss (India) Pvt Ltd.,   to existing customers. Technology helps engage with the tech savvy customers, but
Plot No. 1C/716, Off Dadoji Konddeo Cross    for the masses, a first-time purchase of an insurance policy or a mutual funds or a
Road, Between Sussex and Retiwala Indl.      home loan will not be a click-click-click process. Even for the tech savvy, assisted
Estate, Byculla (E), Mumbai 400027.
                                             models are growing for complex products.
Editor: Manoj Agrawal (Responsible for            So, let me end with the thought that 2022 promises to be a year of a variety
selection of news under PRB Act)             of positive transformations – for individuals as well as organizations – and we at
                                             Banking Frontiers look forward to sharing such developments with all our readers.

                                                                                       Banking Frontiers     December 2021       3
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
N E W S Regulator
Bangladesh to have cybersecurity response team
                                                             The       Bangladesh
                                                                                                  Russia norms for banks
                                                             Bank is setting up an                financing eco-friendly projects
                                                             emergency response                   The Bank of Russia proposes to ease
                                                             team for the financial               capital requirements for banks that lend
                                                             sector, Fin-Cert, to                 money to eco-friendly projects and raise
                                                             a v e r t c y be r a t t a c k s .   them for those giving loans to firms that
                                                             Bangladesh had faced                 do not disclose their ecological impact.
                                                             a major cyberattack 5                Russia is the world’s fourth-largest emitter
                                                             years ago when hackers               of greenhouse gases and relies heavily
                                                             managed to steal $81                 on fossil fuel exports. The central bank
million from the central bank’s accounts with the Federal Reserve Bank of New                     will take climate risks into account when
York. A senior official of the central bank said Fin-Cert will exclusively concentrate            making regulatory decisions on so-called
on the financial industry for emergency security and will take measures to stave                  green and less eco-friendly ‘brown’ projects.
off any possible cyberattacks. The measures it will take include malware threats                  It is expected that the proposal should
to banks from hackers, which the banks are not able to counter. The banks will                    help Russian companies attract extra
then share the issue with the Fin-Cert platform anonymously and also alert other                  investment, including from abroad.
banks and check if anyone else is having similar problems. If any banks have a
solution, they will share the information on the platform. Fin-Cert will also monitor
the banking sector’s cyber security situation and provide necessary support and                   New Governor for
advisories to help prevent probable and imminent cyberattacks.
                                                                                                  Qatar Central Bank
RBI working out details on CBDC implementation
The Reserve Bank of India is working out a phased implementation strategy for
introduction of Central Bank Digital Currency (CBDC) by examining use cases
to avoid any disruptions, the Government said. The RBI has moved a proposal to
this effect to enhance the scope of the definition of ‘bank note’ to include currency
in digital form. The government told the country’s Parliament that the purpose
of creating a digital currency is to provide significant benefits, such as reduced
dependency on cash, higher seigniorage due to lower transaction costs and reduced
settlement risk. The new digital currency would also possibly lead to a more robust,
efficient, trusted, regulated and legal tender-based payments option.

Indonesia, UAE central banks sign agreement
The central banks of Indonesia and the United Arab Emirates (UAE) have signed
an agreement to boost payment system cooperation. The agreement is focused                        Qatar’s ruler, Sheikh Tamim bin Hamad
on safer and more efficient transactions, cross-border payment systems and anti-                  Al Thani has appointed Sheikh Bandar
money laundering and anti-terrorism efforts, the 2 central banks said. A statement                bin Mohammed bin Saoud Al Thani as the
issued by the UAE’s central bank, the partnership aims to improve collaboration                   Governor of the Qatar Central Bank. Sheikh
in payment systems and digital financial innovation, including conventional and                   Bandar has spent most of his professional
Islamic finance. The Bank of Indonesia said the agreement shows its commitment                    life in the financial and regulatory sector.
to fighting terrorism funding and money laundering, while also helping the country                Prior to his appointment as the Governor of
become a member of the Paris-based Financial Action Task Force (FATF).                            the Central Bank, he was Head of the State
                                                                                                  Audit Bureau. He has also held the position
Saudi Arabia to give more licenses to digital banks                                               of President of the Arab Organization of
Saudi Arabia is giving operating licences to more digital banks. Saudi Central                    Supreme Audit Institutions (ARABOSAI)
Bank Governor Fahad al-Mubarak said the Kingdom had issued license for its first                  and Chairman of the Executive Council of
digital banks - STC Bank and the Saudi Digital Bank this year, after the Council of               the Organization. He has also held several
Ministers approved license for 2 local digital banks. Following this, STC Pay was                 senior positions in the Qatar Central Bank,
converted to STC Bank with a capital of SR 2.5 billion and the Saudi Digital Bank                 where he started his career in the Credit and
came into being with a capital of SR 1.5 billion. Al-Mubarak said Saudi Arabia                    Banking Supervision Section, and joined the
has a cross-border digital currency scheme with the United Arab Emirates. He                      Investment Department as head of trading
also pointed out that there is a unified currency for the clearing system among                   and managing the foreign exchange reserves
the banks in the region. This, he added, has given the country the ability, which                 at the central bank. He has an Executive
exceeds the capability of any others in the region, to move to digital currency at                Master of Business Administration (EMBA)
the regional level.                                                                               from the HEC Paris.

4   Banking Frontiers        December 2021
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
Neobanks

US neobank SoFi has members, and not customers
SoFi is a unique financial services institution in the US, that mostly finances
student loans, but is a successful model for neobanks:

U
          S neobank SoFi, or Social Finance,    Facebook, and which include daily podcasts
          was originally a student-loan         and newsletter. It also includes third-party
          platform, but now it aims to be a     content, using data to determine what
source for everything in personal finance.      is most relevant to a particular user. Its
Headed by Anthony Noto, who was                 customers can enjoy learning freely from
instrumental in Twitter becoming a global       a certified financial planner or avail free
platform for information, and had worked        estate planning services. The neobank plans
with Goldman Sachs as its Managing              to have a customer base of 3 million by the
Director, SoFi today offers personal and        end of 2021.
home loans, investment services, small-             While SoFi at the moment does not
business financing, a credit card and several   have a banking charter in the US, it is
other financial products. It considers its      regulated by 50 states for lending, which
customers as members and encourages             means it has to comply with 50 different
them to avail more than one financial           sets of compliance rules. It has in March
offering, a strategy aimed at cutting down      this year, acquired California-based
customer acquisition costs. In the process,     community bank Golden Pacific Bancorp
it is creating for the customers a high-level   for $22.3 million and through it hopes to           One unique thing about SoFi is that it
seamless experience.                            obtain the national bank charter. By being      does not use credit scores, or FICO scores,
     In May 2021, SoFi became a publicly        a bank, SoFi will be able to offer more loans   from any of the US’s credit bureaus
traded company, called SoFi Technologies,       and no longer have to limit its number of       to determine the creditworthiness of
following a merger with Social Capital          mortgages. The license will also allow it to    its customers. It has its own AI-based
Hedospophia Holdings Corp. It is now a          determine its own interest rates instead of     underwriting model that examines
leading, publicly traded consumer-focused       relying on a sweep partner.                     free cash flow, professional history and
financial technology platform on Nasdaq.            SoFi has partnership with 6 banks,          education in addition to a history of
It raised $2.4 billion in cash proceeds         including Metabank, Hills Bank & Trust,         responsible bill payment to evaluate
from the transaction, which it intends          EagleBank and Wells Fargo.                      its borrowers and to increase customer
to use for growth, market expansion and             The neobank intends to become               engagement. It does not take deposits
development of new product offerings,           profitable on a GAAP basis by 2023,             and finances its loans through venture
as well as for geographic expansion and         projecting $200 million in GAAP net             capital, bond issues via securitization and
building the first digital one-stop-shop for    income in that year. While its revenue          debt financing. It has its own hedge fund
members to ‘borrow, save, spend, invest         comes from lending, it expects the              to purchase the loans it issues.
and protect’ their money. At present,           business to become more balanced by
its offerings mainly constitute student         2025 with greater revenue from financial        STUDENT LOAN REFINANCING
loan refinancing, mortgages, personal           services and the company’s technology           SoFi today is the largest provider of student
loans, credit card, investing and banking       platform.                                       loan refinancing, with over $5 billion dollars
through both a mobile app and desktop                                                           in loans funded. Unlike traditional lenders,
interfaces. Its target customers are ‘high      BUYING GALILEO                                  its proprietary underwriting approach
earners not well-served’, or people who         SoFi now owns the Galileo platform,             takes into account merit and employment
have taken out financial offerings from         which it acquired in April 2020 for $1.2        history to offer unique products that its
multiple institutions.                          billion. Salt Lake City-based Galileo is        ‘members’ will not find elsewhere.
                                                the API standard for card issuing and is             SoFi’s key milestones are:
NEWS FEED FOR CUSTOMERS                         the platform that powers world’s leading        u $5B+ total loan originations

Noto, who has vast understanding of             fintechs, financial services providers and      u Secured $1B in Series E funding in

technology and finance, believes that no        investment firms. The platform uses APIs to         September 2015, the largest single
one in the past had really built a financial    enable enterprises build financial services         financing round in the fintech space
services experience on one digital platform     offerings. The APIs enable account setup,           to date
and used data to drive great value.             funding, direct deposits, money transfers,      u First rated P2P securitization

Something unique that Noto has designed         bill payment and other capabilities. Galileo    u $2 billion + in securitized products issued

for SoFi is a feed of financial information     now provides SoFi’s main technology             u GAAP profitable

like the news feeds on Twitter and              infrastructure.                                                 mohan@bankingfrontiers.com

                                                                                                Banking Frontiers      December 2021        5
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
Insurance & Technology

How Turtlemint sells 10,000
insurance policies every day
The platform provides advisors with digital tools enabling them to
sell multiple insurance products of different companies through one
single app:

F
       ounded in 2015, India-born                                                         to issue an insurance policy instantly
       insurance platform Turtlemint                                                      online to our prospective buyer. We have
       has a unique online-offline model.                                                 been able to create India’s largest PoSP
Dhirendra Mahyavanshi, Co-Founder,                                                        network of more than 1,25,000 advisors.
explains: “Our hybrid model empowers                                                      This indicates a 161% increase in PoSPs
insurance advisors across the country                                                     over the last year. A majority of our PoSPs
with digital tools to navigate an otherwise                                               - approximately 76.5% - fall in the 22-40
cumbersome offline selling process at                                                     years age group, who are highly tech
scale quickly. We have grown significantly                                                savvy. From a geographical presence
since inception via our user-friendly and                                                 perspective, approximately 9.33% are
innovative digital platform.”                                                             from tier 1, around 26.4% are from tier
                                                                                          2, and a significant 64.27% are from tier
MOBILE APP, SEAMLESS SELL                                                                 3 cities.”
One of the main reasons why Turtlemint                                                        The app allows the insurance advisors
has been able to achieve good growth                                                      to upskill by providing access to a
is because it has not lost sight of its                                                   comprehensive online skill development
overarching goal to improve insurance                                                     program. Dhirendra further says: “The
penetration in the country by leveraging                                                  program offers 70+ courses ranging
the right technology tools. It currently       Dhirendra Mahyavanshi                      from insurance advisor certification to
has a base of approximately 3.5 million        points out that Turtlemint has             personality development courses, sales
clients, which it acquired online in a short                                              skills, podcasts, etc. We have a dedicated
                                               been fairly active on multiple
span. It sells around 10,000 policies daily.                                              section for advisors that provides several
Health insurance is its fastest-growing
                                               social media channels                      tools that can help them achieve their
segment which has grown by 2x in the                                                      main goal. The tools can help them
last year and by 35% y/y in the first half     products of multiple insurance             get new leads, access posters, videos,
of the current FY.                             companies through one single mobile        curated daily news, product videos,
    Turtlemint has been empowering             application. Secondly, the app helps       brochures, etc.”
the most important cog in the insurance        insurance advisors to expand their
ecosystem, i.e., the insurance advisor by      business through better service to         IN-HOUSE TECH TEAM, TOOLS
leveraging the technology. Dhirendra           existing clients and by expanding the      Turtlemint proactively leverages
explains: “Our mobile app Mintpro              client base. Dhirendra adds: “We have      existing and emerging technologies
enables advisors to seamlessly sell the        created a groundbreaking multilingual      to create efficient and customized
right insurance policies to their clients      digital solution in the form of the        solutions for clients. Dhirendra
and also to expand their business. The         Mintpro app that empowers advisors         explains: “We have a tech team of 150+
pandemic has accelerated the pace of           and enables them to grow their business    developers and all the development and
digital adoption and I am happy to say         by selling the right insurance policies,   product innovation are done in-house.
that we are already ahead of the curve         to the right people, and in a seamless     We use tools like Jira, Slack, Monday &
when it comes to creating seamless             manner.”                                   Google Business Solutions for seamless
digital solutions.”                                                                       communication between teams. We
    100% of Turtlemint’s business is           UPSKILLING ADVISORS ONLINE                 use Amazon Web Services for hosting,
digitally driven. The app has various          Turtlemint has a vast pool of point-       server space, etc.”
facets - firstly, it provides insurance        of-sale persons (PoSPs), its insurance        People and technology form the very
advisors with digital tools that can           advisors. Dhirendra explains: “These       core of Turtlemint’s business strategy.
enable them to sell multiple insurance         PoSPs are trained digitally and equipped   Dhirendra adds: “An unwavering focus

6   Banking Frontiers      December 2021
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
on harnessing the value of these two                                                                       queries to reduce turnaround time
factors has held us in good stead and                                                                      and improve consumer happiness. At
enabled it to grow at a strong clip. More                                                                  Turtlemint, these are used to quickly
specifically, we have been able to double                                                                  respond to standard user queries.
our revenue run rate.”                                                                                     Dhirendra further states: “We deploy
                                                                                                           Deep Learning and Optimal Character
RPA, DEEP LEARNING, OCR                                                                                    Recognition (OCR) capabilities for
Examples of how Turtlemint leverages                                                                       extracting relevant information from
technology are interesting. Dhirendra                                                                      digital documents. These are used for
describes: “We use intelligent automation                                                                  generating quotes from the previous
with technologies like Robotic Process                                                                     year’s policy copy or RC book. The same
Automation (RPA) for repetitive,                                                                           technology is also used to reduce all the
manual and cumbersome tasks like                                                                           manual efforts to ensure the completeness
policy database reconciliation, claims                                                                     of the data in MIS.”
and issuance. We deploy Deep Learning
models that leverage and analyze the                                                                       GENERATING LEADS, GROW
data collected through user interactions,                                                                  Turtlemint has also introduced multi-
while ensuring that the privacy of users                                                                   channel and multi-platform short story
                                                       Anand Prabhudesai explains
is maintained. These models help us                                                                        formats for content consumption.
to predict user churn, identify upsell/                that data science and data                          Dhirendra says: “A similar approach
cross-sell opportunities, enhance the                  engineering have become                             is also being followed for consumer
conversion of the leads, etc.”                         critical focus areas for the next                   education and awareness. In addition
   Chatbots are used for handling user                 phase of growth                                     to creating visibility, this also helps
                                                                                                           in generating leads for advisors.” The
                                                                                                           Mintpro app has a GROW section which
                        Acquiring Startup To Realize                                                       has a wide range of content. Dhirendra
                          Data Engineering Plans                                                           further says: “This content is easily
                                                                                                           shareable amongst all members of the
  In the post covid- scenario, Turtlemint has set its targets and plans for IT, digital initiatives,
                                                                                                           Mintpro ecosystem.”
  for business growth in the foreseeable future. Dhirendra reveals: “Turtlemint strongly believes
  that the technology will continue to be the main driving force in the insurance ecosystem,
  orchestrating change and enabling inclusive growth. As we forge ahead, we plan to focus on               SOCIAL MEDIA PRESENCE
  automating processes and optimally leveraging data science, data engineering, Robotic Process            Turtlemint has a strong presence on
  Automation (RPA), and deep learning and OCR capabilities.”                                               social media. It has always believed
                                                                                                           that a subject like insurance and special
  Turtlemint recently acquired Pune based startup IOPhysics Systems. IOPhysics has a highly
                                                                                                           technology in insurance needs to be
  talented tech team. The startup aims to help data scientists and data engineers derive
  intelligence from structured or unstructured data in real-time. As part of their highway to a 100        accurately communicated and made
  Unicorns program, Microsoft recognised IOPhysics as the ‘Most Innovative & High Potential                relatable to the target audience so that
  Startup’ across tier-2 cities in India. As a part of the deal, Turtlemint will also be taking over the   its true benefits can be reaped by all
  IOPhysics IP and product portfolio. Passion Connect, the HR advisory unit incubated by Blume             ecosystem stakeholders. Thus, Dhirendra
  Ventures, one of Turtlemint’s investors, played a crucial role in this acquisition.                      points out: “We are fairly active on
                                                                                                           multiple social media channels and
  Turtlemint co-founder Anand Prabhudesai explains the whole process: “As our company goes
  into the next phase of growth, data science and data engineering have become critical focus              consistently post information related to
  areas. Passion Connect recognized this need, leveraged its strong network in the startup                 insurance concepts, educational videos,
  community and connected us to various startup teams across domains. We loved the IOPhysics               industry updates, and current affairs. A
  team, their IP and product since it allows developers to be cloud-agnostic and pick data platforms       similar approach is also being followed
  that suit the best need for the use case.”                                                               for consumer education and awareness.
                                                                                                           In addition to creating visibility, this also
  IOPhysics’ founder and CEO Ashish Gawali will join the Turtlemint team as their VP, Data Science
  and Data Engineering, while the rest of the IOPhysics team will join the tech and data science           helps in generating leads for advisors. For
  verticals at Turtlemint. Its USP is its flexibility to integrate any data with any public cloud data     video content, we have Youtube channel
  platform of choice and data visualization tool – all with an easy-to-use interface. Ashish Gawali,       www.youtube.com/c/InsuranceGyan.
  founder, IOPhysics, says: “When we were introduced to Turtlemint, we realized that both teams            For the other educational and industry
  shared the same passion for improving people’s lives, even in remote pockets of the country. In          updates, we have active LinkedIn, Twitter
  addition, we have immense respect for the intelligence and experience of their leadership team.”         and Facebook channels.”
                                                                                                                           mehul@bankingfrontiers.com

                                                                                                           Banking Frontiers     December 2021        7
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
Brokerages

Technology, demography &
geography drive growth
ICICI Securities, Kotak Securities and HDFC Securities top the list: Profit
for bank-brokerages likely to grow 20%

T
        he domestic capital markets                                                           uptick in earnings in FY2021 registering
        continue to remain on an                                                              a y/y growth of 40% in total revenues
        upwards trajectory after a strong                                                     and 80% in profit after tax. Samriddhi
performance in FY2021. The average                                                            points out: “Bank-brokerages have been
daily turnover (ADTO) increased to                                                            increasingly looking at other non-broking
`27.92 trillion in FY2021 from `14.39                                                         sources of income, namely capital market
trillion in FY2020, registering an annual                                                     lending business, distribution income
growth of 94%. As per ICRA, the market                                                        and investment banking revenue. Bank-
performance has been supported by                                                             brokerages have significantly scaled up
favourable liquidity in both domestic and                                                     the margin funding business over the
international markets, optimism related                                                       past fiscal, moving in line with the capital
to a recovery after the graded reopening                                                      market rally, which has resulted in an
of the economy, progress on vaccination                                                       increase in their borrowing level.”
rollout and steady retail investor
momentum. Samriddhi Chowdhary, VP                                                             FIRST-TIME INVESTORS
& Sector Head, Financial Sector Ratings,                                                      The retail broking segment has witnessed
ICRA, updates: “Transaction volumes                                                           a significant disruption in the last few
remain strong in the current fiscal,                                                          years due to the growing prominence of
with the markets clocking an ADTO of        Samriddhi Chowdhary feels                         discount brokerages. The competitively
Rs56.36 trillion in H1 FY2022.”                                                               priced offerings of discount brokers and
                                            that the ability of the bank                      the no-frill basic accounts and services
DISCOUNT BROKERS GAINING                    brokers to effectively ramp up                    have resulted in the realignment of the
The pool of ICRA-rated bank brokerages      their digital initiatives would                   pricing strategy across the industry. Adds
reported a strong performance in FY2021     be critical                                       Samriddhi: “Apart from attracting clients
with the estimated average daily turnover                                                     from full-service providers, discount
(ADTO) increasing 28% y/y to `1.51
trillion from `1.18 trillion in FY2020,
led by the healthy growth in the retail
                                              Trend in net operating income (NOI) growth of bank brokerages
segment. Samriddhi explains: “Despite
the changes in the margin requirements,                          8,000                                                                       50%
the performance remained healthy in                              7,000                                                                       40%
Q1 FY2022 with an estimated ADTO                                 6,000                                                                       30%
                                              Amount (` Crore)

of `1.64 trillion, driven by favourable
                                                                 5,000                                                                       20%
retail investor sentiment. However,
                                                                 4,000                                                                       10%
the market share of the sample pool of
ICRA-rated bank brokerages in terms of                           3,000                                                                       0%
transaction volumes declined in FY2021                           2,000                                                                       -10%
and moderated further in Q1 FY2022                               1,000                                                                       -20%
as they continue to lose share to                                    0                                                                       -30%
discount brokers.”                                                       FY2017    FY2018       FY2019          FY2020         FY2021

MARGIN FUNDING BUSINESS                                                           Net operang income           Growth %
Bank-brokerages reported a strong

8   Banking Frontiers    December 2021
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
brokerage houses have helped expand                     Trend in PAT and margin of ICRA sample of bank brokerages
the market by bringing on board a large
                                                                   3,500                                                                   50%
number of first-time investors. While the
market share for bank brokerages in terms                          3,000
                                                                                                                                           40%
of active clients moderated in FY2021,                             2,500

                                                Amount (` Crore)
primarily owing to the faster scaling                                                                                                      30%
                                                                   2,000
up of the discount brokerage houses,
they reported a strong performance as                              1,500                                                                   20%
reflected by the healthy operating metrics                         1,000
and surge in earnings.”                                                                                                                    10%
                                                                    500
                                                                      -                                                                    0%
RAMP UP ONLINE CHANNELS
                                                                           FY2017   FY2018      FY2019        FY2020        FY2021
ICRA expects bank brokerages to
continue to build their retail franchise                                                PAT        PAT Margin
and focus more on technology and
digital models for customer acquisition.
Samriddhi elaborates: “The cost structure
and operational efficiency of the bank        PROFIT, BORROWINGS, GEARING                     TOPPERS IN VARIOUS CRITERIA
brokerage companies also improved             ICRA expects the net operating income           ICRA has picked the top bank-
over the past few years with focus on the     (NOI) of bank brokerages to grow                brokerages in terms of active clients on
rationalization of branches, coupled with     20-25% y/y in FY2022, supported                 National Stock Exchange (NSE). The
cautious efforts towards the transition       by steady broking income along with             sample includes top 5 bank brokerages
to a digital business model, thereby          an uptick in the margin funding and             for analysis of earnings and other
improving the operational efficiency          distribution businesses; the ramp-up of         financial metrics, and top 4 bank-
across brokerages.”                           other capital markets related businesses        brokerages for the study of transaction
    Bank brokerages are also increasingly     could further support the earnings              volumes and yields. Samriddhi informs:
looking at the emerging demographic           profile. Samriddhi predicts: “The net           “Based on NSE data on active clients,
opportunities and new geographical            profit for bank brokerages is expected to       there are 11 bank-brokerages active in
base, which is facilitated through online     grow 17-20% during the same period. The         domestic capital markets. Our sample
channels. Samriddhi feels: “Going             borrowings levels of bank brokerages are        of bank brokerage companies include
forward, the ability of the bank brokers      expected to increase in the current fiscal      Axis Securities, HDFC Securities, ICICI
to effectively ramp up their digital          to support their margin funding business.       Securities, Kotak Securities and SBI
initiatives, attract millennial clients and   The gearing levels of bank brokerages are       Capital Markets.”
expand to a newer geographical base such      expected to be in the range of 1.5-2 times          She provides necessary details of 3
as tier 2 & 3 cities would be critical.”      in FY2022 at an industry level, while           toppers of bank-brokerages to substantiate
                                              the gearing across entities would vary          their positions at the industry level.
BETTER BRAND RECALL, TRUST                    between 1 to 3 times based on the scale         She cites comparative data on different
Supported by these factors, bank              of margin funding operations.”                  parameters: “As of March 2021, in terms
brokerages are expected to register a                                                         of active clients (NSE), ICICI Securities
healthy growth in client addition as          CAGR 19% IN 3 YEARS                             topped with 1,580,233 accounts,
well as transaction volumes, though           Bank brokerages attribute to 21% of             followed by HDFC Securities (957,085)
their share in total active clients would     total active clients on NSE as of August        and Kotak Securities (743,206). ICICI
moderate owing to the rapid expansion of      2021; the share was about 23% as of             Securities recorded `958 billion ADTO,
the discount broking model. The blended       March 2021. Total active clients for bank-      followed by Kotak Securities (`361.26
yields are expected to compress going         brokerages increased to 4.17 million            bn) and HDFC Securities (`91.72 bn
forward, though the focus on fee and          clients as of March 31, 2021 from 2.56          for 9 months). ICICI Securities earned
fund-based income would support the           million as of March 31, 2018 registering a      NOI of `23.18 billion, followed by Kotak
profitability. Samriddhi indicates: “Bank     compounded annual growth rate (CAGR)            Securities (`19.41 billion) and HDFC
brokerages are expected to continue to        of 19%. Samriddhi states: “The top 4            Securities (`13.37 billion). As far as PAT
enjoy better brand recall, trust, higher      bank brokerages together attributed to          is concerned, ICICI Securities came first
credibility and financial flexibility by      nearly 5% of total industry transaction         with `10.68 billion, followed by Kotak
virtue of being a part of banking groups      volumes; the market share would be              Securities (`7.93 billion) and HDFC
and would, therefore, remain a prominent      nearly 9-10% adjusting for proprietary          Securities (`7.03 billion).”
part of the industry value chain.”            trading volumes.”                                              mehul@bankingfrontiers.com

                                                                                              Banking Frontiers    December 2021      9
NBFCs DRIVE ON MULTIPLE FRONTS - NABARD Turtlemint - Banking Frontiers
Business Technology Alignment

Cooperative banks & technological adoption
- Keeping pace with the competition
In an exclusive interaction, Mannu Singh, Vice-President, Tata
Teleservices shares the details about the next gen connecting solutions
for cooperative banks in India:

Ravi Lalwani: What offerings from Tata         timely, and actionable information
Tele Business Services have become             about customer relations. A single
popular among cooperative banks?               view between banks and customers at
    Mannu Singh: M o s t o f t h e             any time helps speed up operations.
cooperative banks have a core banking          The bank gets further advantages
setup hosted on their data centre              by easily introducing new financial
centrally and all branches are required        products and manage changes in
to connect to the setup. The core banking      existing products. The seamless
services include mortgages, deposits,          merging of back-office data and
loan, and credit processing capabilities,      self-service operations brings
with interfaces to general ledger systems,     in a great deal of operational
and reporting tools. Cooperative banks         efficiency.
make these services available to their             Greater          customer
customers across multiple channels like        satisfaction: The entire range
ATMs, internet banking, mobile banking,        of banking products including
and branches that are geographically           savings, deposit accounts, etc,
spread across cities and states.               are available from any location
    Tata Tele Business Services (TTBS) is      seamlessly through reliable and
a smart connectivity solution that helps       secure connectivity solutions
bank branches to connect seamlessly.           from TTBS. Easy accessibility
u Secure MPLS network for banks to             and customer operations through
   prioritize and set up highly efficient      multiple channels, including
   routes for customer traffic, get assured    mobile banking and the web,
   of a high QoS, and benefit from any-        become possible.
   to-any connectivity.                            Increased customer base: The
u Multiple PRI lines facilitate the            availability of real-time transactions
   concurrent transmission of voice as         and the entire portfolio of financial
   well as data traffic over the dedicated     products available through the
   line with the flexibility of using          internet and mobile banking enable
   multiple channels at the same time.         reaching out faster to customer and
u High-speed internet leased line with         helps in increasing the customer base.
   secured connectivity for business           The flexibility to scale up solutions
   efficiency.                                 helps in easy expansion of services.

How have these helped banks to                 How does Tata Tele Business
strengthen their business?                     Services help banks identify the best
    TTBS provides advanced bespoke             technologies and services to achieve
solutions which provide secured                their business goals?
connectivity, flexibility and are backed          Tata Tele Business Services
by 24x7 managed support services.              works as a progressive digital catalyst
These solutions help build operational         to enable the banks to adopt the
efficiency, greater customer satisfaction      best connectivity and collaboration
and increased customer base.                   solutions that significantly boost
    Operational efficiency: Bank staff         their customer experience and
can easily and at a quickly access accurate,   help them to do big. The most

10   Banking Frontiers      December 2021
important challenge in the transition         data breaches, the importance of               How is Tata Tele Business Services
towards ‘digitization’ is the cooperative     cyber security cannot be overlooked.           helping banks migrate from the capex
bank’s preparedness and readiness in          TTBS offers endpoint security, email           model to the opex model? How does it
terms of technology and innovation.           security, web security, multi-factor           help - especially when the service loads
Some of them lack reliable connections        authentication, and virtual firewall.          fluctuate from minimal to peak?
that can ensure secure transactions               We have recently introduced the                Being fast and flexible is at the
and protection of all customer data.          industry’s first ‘Customer Experience          foundation of all digital and network
Given the transaction data’s sensitive        Platform (CEP)’. CEP provides first-           transformation initiatives today. For
nature, there is a need for a seamless        hand experience of our solutions and           cooperative banks the cost of building
and secure communication channel that         services to our potential customers,           and maintaining their private networks
provides the right collaborative tools        and shows how they can utilize these           can be high and legacy connectivity
to make transactions more efficient.          for improving their business processes,        solutions (like private WANs using
They must also make sure that they            and then make an informed buying               MPLS) can be financially crippling.
are equipped with an easy to configure        decision. Additionally, our solution               This is where TTBS introduced
hosted infrastructure that facilitates a      experts are available for interactive          SDWAN-iFLX which brings intelligence
distributed working environment.              consultative sessions with our customers       and flexibility. Powered by Fortinet,
    TTBS has an array of solutions            to guide them to smoothly integrate            the SD-WAN iFLX solution offers
to help co-operative banks leverage           these solutions within their existing          operational simplicity, application-level
digitalization:                               technological framework with minimum           prioritization, and visibility, integrated
    Smart VPN: An MPLS-based virtual          disruptions.                                   security, enhanced overall business
private network that enables you to share                                                    application environment as well as
data securely and confidentially over any     What would Tata Tele Business Services         much-needed resilience at an affordable
internet service, from any location.          advise banks for improving overall             price point.
    Smart Internet Leased Line: A             customer experience?
dedicated source of secured internet              TTBS helps with evolved connectivity       Finally, how can the technology ROI be
service with uncontended bandwidth            and security solutions for BFSI                justified?
and symmetric upload & download for           operational efficiency and improved                As the businesses of customers
remote users.                                 customer experience. As the cooperative        expand and grow, their banking needs
    Session Initiation Protocol (SIP):        banking sector sets upon its post-covid        too are rapidly evolving. Post covid,
A signaling protocol to facilitate            digital transformation journey, the            the quantum of financial transactions
interactive communication sessions,           key imperatives that it must consider          over digital modes has increased
including voice, video, and chat over the     include:                                       tremendously. With the penetration of
internet.                                     u Have     robust smart internet               the internet and smartphones, customers
    Hosted PBX: A feature-rich SIP-              connectivity which is highly secured.       are using more digital payment gateways
based telephony solution for outbound         u Focus     on enhancing digital               than using cash for transactions.
calls from any location.                         banking experiences as customers            Cooperative Banks need to add more
    Cyber Security Solutions: With               are becoming more comfortable               and more products in their kitty and
ever-increasing cyber threats and                with digital modes of banking and           at the same time, increase channels of
                                                 transactions.                               accessibility to their customers.
                                              u Emphasize more on the adoption of                With this, the need for robust
        Customer View                            cloud solutions which are capex and         networking practices has skyrocketed.
  “For a seamless banking experience,            opex light and provide anywhere,            Connectivity across branch locations that
  we chose to use Tata Tele Business             anytime working flexibility to the          is seamless, break-free, with minimum
  Services’ MPLS solution. With                  banking workforce.                          or no downtime, congestion-free, and
  maximum uptime, stable and reliable         u Stress more on cybersecurity and             with faster speed is quite the necessity
  VPN connectivity, and 24x7 support             data privacy to provide secured and         today for operational resilience. At
  team, uninterrupted and smooth
                                                 uninterrupted services.                     the same time, secure connectivity is
  operations are ensured, increasing
                                                  To add further, a better managed           what most banks today look at. Cyber
  our productivity and enhancing our
                                              toll-free number can help the bank             security is like insurance to prevent
  customer experience and digital
                                              bring a paradigm shift in its customer         great financial, legal, and reputation
  onboarding.”
                                              experience by enabling customers to            loss which may directly impact the loss
                       - Pragnesh J. Mehta
    Executive Officer IT, Sardar Bhiladwala   conveniently reach out to the bank             of customer base and business, especially
   Pardi Peoples (SBPP) Cooperative Bank      without any cost - this is also as per RBI’s   in the competitive scenario today.
                                              recommendation.                                                    ravi@glocalinfomrt.com

                                                                                             Banking Frontiers   December 2021       11
Research Report – Data Maturity

Enterprise data strategy boosts profits by 5.97%
C
         loudera has announced the            enterprise data strategies for more
         findings of a global research        than a year reported them to be very
         report, created in association       effective (63%), along with higher profit
with technology market research firm,         growth. Nearly all ITDMs (91%) whose
Vanson Bourne. The report examines            organizations have an enterprise data
the correlation between the maturity          strategy in place agree that their current
of an organization’s enterprise data          strategy is key to their business resiliency.
strategy (defined as an organization-         SDMs surveyed report an average of
wide, integrated, holistic strategy across    $384,962 lost annually due to missed
all lines of business) and its business       opportunities involving data, with the
performance. It also explores the impact      telecom industry reporting the highest
that the ongoing covid-19 pandemic and        average annual loss of $6,617,348.
its uncertainties have on businesses.
    The research found that organizations     THE FUTURE IS HYBRID                            DATA DRIVES SUCCESS
with mature enterprise data strategies in     The report shows an anticipated shift           BEYOND PROFITS
place for at least 12 months report higher    to hybrid cloud in the next 18 months.          Utilizing data and analytics can yield
profit growth at an average of 5.97%,         With both SDMs and ITDMs reporting              more benefits than simply increasing
according to surveyed senior business         that 43% of their workforce will                profit margins or gaining a competitive
decision makers (SDMs). 96% of SDMs           continue working remotely in the next           advantage. Most organizations recognize
reported that the way data is handled and     year, organizations are investing in            the vital link between Diversity, Equity,
managed has positively impacted their         infrastructure to support hybrid working        and Inclusion (DEI) initiatives and
organizations’ performance, and close         environments. A majority (79%) of               organizational success. The research
to two-thirds (64%) reported stronger         ITDMs’ organizations are looking to             found that thoughtful data collection
levels of resiliency from the presence of a   house their data and performance                and analytics contribute to the success of
mature data strategy. Both SDMs and IT        analytics on hybrid architectures. Among        DEI initiatives. Nearly all ITDMs (96%)
decision-makers (ITDMs) share similar         cloud options, multi-cloud emerged              and SDMs (95%) believe that data and
views, recognizing data as a strategic        as a clear favorite, with 44% of ITDMs          analytics are important to ensuring
business resource, but these groups           indicating their preference for multi-          successful and effective DEI initiatives,
have differing opinions on operational        cloud architectures in 18 months’ time.         and 95% of both ITDMs and SDMs
processes and implementation.                 With the hybrid data cloud, organizations       agree that DEI initiatives contribute to
                                              can access and analyze data fast and            organizational success. Organizations
HINDERANCES TO INNOVATION                     with ease to make smarter, data-driven          with effective enterprise data strategies
Visibility remains a key issue for            decisions to effectively meet the demands       in place are better able to utilize data
organizations, with 89% reporting secure,     of today’s hyper-competitive business           and analytics to benchmark and evaluate
centralized governance and compliance         climate.                                        employee diversity programs. With
over the entire lifecycle as being valuable       Accessing and managing data from            greater visibility over diversity within
when handling and managing data.              multiple sources and locations will give        organizations, comes better decision-
Only 12% of surveyed ITDMs report             organizations the control and flexibility       making, greater innovation and higher
that their organization interacts with        of utilizing a hybrid workforce while still     engagement in the workplace.
all stages of the data lifecycle process –    being able to run business as usual. Nearly
something immensely helpful in helping        all SDMs (92%) believe that making              METHODOLOGY
organizations achieve an enterprise           sense of all data across hybrid, multi-         Vanson Bourne conducted the survey
data strategy. Without complete control       cloud and on-premises architectures is or       online and over the phone between July
and visibility over every aspect of data,     would be valuable. This finding mirrors         and September 2021, surveying 3150
organizations will lack key capabilities      the sentiments of a majority of ITDMs           respondents holding either c-level, senior
required to drive innovation.                 (90%), who report that managing data            management or middle management
                                              with at least some cloud capacity is a          positions from large organizations.
EFFECTIVE ENTERPRISE DATA                     priority for their organization. A similar      Respondents were from 15 markets:
STRATEGIES REMAIN KEY                         majority (89%) believe that organizations       Australia, China, France, Germany,
Organizations see the value in enterprise     implementing a hybrid architecture              India, Indonesia, Italy, Japan, Singapore,
data strategies but struggle to make          as part of its data strategy will gain a        South Africa, South Korea, Spain, UAE,
them effective. Organizations utilizing       competitive advantage.                          UK, and the USA.

12   Banking Frontiers     December 2021
Social Transformation

Crime & Intoxication drops where PMJDY flourishes

S
       ound financial inclusion policies                                                      the share of OFF-US transactions in AePS
       have a multiplier effect on                                                            increased from 4% in September’16 to
       economic growth, reducing poverty                                                      51% in September’21. Considering these
and income inequality, while also being                                                       facts, PSBs (that opened around 77% of
conducive for financial stability. India                                                      the PMJDY accounts) are now net payers
has stolen a march in financial inclusion                                                     of interchange fee. It is estimated that the
with the initiation of PMJDY accounts                                                         PSBs could be paying around `6-7 bn per
since 2014, enabled by a robust digital                                                       annum as interchange fee.
infrastructure and also careful recalibration
of bank branches and thereby using the BC                                                     FINE-TUNE BC MODELS
model judiciously for furthering financial                                                    The following recommendations have
inclusion. The number of bank branches                                                        been suggested in the report to make the
per 100,000 adults rose to 14.7 in 2020         Dr. Soumya Kanti Ghosh                        BC model more rigorous and uniform
from 13.6 in 2015, which is higher than                                                       across all banking entities.
Germany, China and South Africa, says           branchless banking. However, the                  Firstly, as AePS works like a Point
Dr. Soumya Kanti Ghosh, Group Chief             success of financial inclusion depends        of Sales (PoS), logically the ‘acquiring
Economic Adviser, State Bank of India, in       upon Banking Correspondents (BCs),            bank’ should pay the interchange fee to
a recent research report.                       who are micro-level entrepreneurs.            the ‘issuing bank’. Alternatively, there
                                                Interoperability of transactions is           could be rationalization in interchange
DIGITAL PAYMENT LED FI                          permitted by RBI at the retail outlets        fee as there is no level playing field in
Such financial inclusion has also been          or sub-agents of BCs ( at the point of        infrastructure provided by all banks.
enabled by use of digital payments as           customer interface), subject to certain       With requisite savings, banks can further
between 2015 and 2020, mobile and               conditions. Herein lies the problem.          strengthen/upgrade their BC model and
internet banking transactions per 1,000                                                       promote financial inclusion in a more
adults have increased to 13,615 in 2019         `7 BN INTERCHANGE FEE                         holistic manner.
from 183 in 2015.                               The research report from the State Bank of        Secondly, RBI should disincentivise
    In the last 7 years of launch of PMJDY      India’s Economic Research Department          BCs who are converting the ON US
scheme, the total number of accounts            further notes that it is sometimes            transactions of PSB customers to AePS
opened under PMJDY has reached 437              observed that there is no uniformity          OFF US transaction in order to earn
million, with `1.46 trillion of deposits as     among the BCs across banks regarding          interchange fee and more commission.
on October 20, 2021. Of these accounts,         adherence to the above guidelines. PSBs       For this, a comprehensive database of
nearly 2/3 are operational in rural and         mostly follow ‘Branch Led BC Model’,          BC agents be prepared through IBA’s BC
semi-urban areas. More than 78% of              while other banks follow ‘Branch Less/        registry, JanDhan Dharshak App and
PMJDY accounts were with PSBs and               Corporate BC model’. The BCs of PSBs          RBI’s CISBI portal.
18.2% are of RRBs, while non-PSBs’              extend basic banking services, including          Additionally, the log-in to the AEPS
share is 3%.                                    opening of accounts, from a fixed location    applications of the non-branch BC model
    SBI’s research also shows that states       under the oversight of specific bank          must be through Aadhaar authentication.
with higher PMJDY accounts balances             branch. The BCs of other banks operate        This will prevent anyone from logging
have seen a perceptible decline in crime.       through ‘Micro ATM/Kiosk Application          and performing unverified transactions.
It has also been observed that there is both    on Mobile’ and primarily provide fee-         This will also result in BCs and their
statistically significant and economically      based financial services, viz. withdrawals    friends and relatives not being able to
meaningful drop in consumption of               and remittance services, using hand-held      game the system by opening accounts
intoxicants such as alcohol and tobacco         devices. This also adds to the bottom-line    with multiple banks and performing
products in states where more PMJDY             by way of interchange fee from the PSBs       round tripping/ withdrawals.
accounts are opened.                            or remittance fee from PSB customers.             Some minor tweaks in the existing
                                                    As a typical example, BCs convert         branch less BC model could act as a
OUTLETS IN VILLAGES UP                          AePS ON-US transactions of one set of         multiplier for promoting financial
The number of ‘Banking Outlets in               bank customers, to AePS OFF-US issuer         inclusion objectives. This is all the more
Villages - BCs’ has risen from 34,174 in        transactions and also carry out multiple      important as 347 million informal labour
March’10 to 1.24 mn in December’20.             AePS ON-US and AePS OFF-US                    force is currently being formalized
Such progress shows an impressive               transactions on the primary bank              through the E-Shram portal.
outreach of banking services through            application/software. Data indicates that                     mehul@bankingfrontiers.com

                                                                                             Banking Frontiers     December 2021       13
Leadership

LDP identifies & grooms future leaders at Indian Bank
I
   ndian Bank commemorated its 115th                                                                   hindrances during the ongoing pandemic.
   foundation day on August 15, 2021. The                                                              All the above listed phase 1 tools have been
   bank has a staff of 24,821 officers, 12,995                                                         administered online. The phase 2 tools
clerks, 2769 sub-staff and 311 full time                                                               had been undertaken seamlessly over MS
sweepers, totaling to 40,896 staff, as of Q1                                                           Teams, with participants and assessors
FY 22. Females comprise 28% of the staff.                                                              joining from various locations.”
Shanti Lal Jain assumed charge as MD
& CEO of Indian Bank on 1st September                                                                  E-LEARNING PLATFORM
2021. He is supported by 3 executive                                                                   Indian Bank has unveiled the IB e-note /
directors - Shenoy Vishwanath V., Imran                                                                e-dak facility, aimed at providing a paperless
Amin Siddiqui and Ashwani Kumar.                                                                       working environment and to improve the
                                                                                                       turnaround time considerably. Dhanaraj
LEADERSHIP: ONLINE TOOLS                                                                               elaborates: “The bank has customized
For existing employees, the Indian Bank                                                                Microsoft SharePoint. It also unveiled
conducts 4 tests in a year to test the                                                                 ‘Ind Guru’, an e-learning platform for its
knowledge of the employees regarding                                                                   employees that offers technology enabled
latest banking updates and policies. Earlier                                                           solutions aimed at capacity building. The
the bank didn’t link these tests to annual                                                             bank identifies the process automation and
performance appraisal report (APAR) score,          Dhanaraj T informs that Indian                     digital workflow amongst the other initiatives
however, Dhanaraj T, GM, HRM / CDO,                 Bank has launched the LDP for                      as a part of its digital transformation.”
(Chief Development Officer), clarifies: “At         800 officers in scale IV
present these tests carries weightage in the                                                           CHANGE AGENTS
APAR score. The bank conducts Leadership            the parent competency score. The parent            Post covid pandemic, Indian Bank has
Development Program (LDP) for officers              competency scores are then averaged to             focused on ensuring flexibility in work
in scale IV to VI and psychometric test is          arrive at the tool-wise score.”                    and the workplace. Given the ongoing
part of LDP. In the current FY, our bank has                                                           pandemic, WFH (work from home)
launched the LDP for 800 officers in scale          TECHNICAL SKILLS                                   opportunities are being explored. Dhanaraj
IV. The objective of this exercise is to identify   The bank finds outcomes of these tests to be       clarifies: “A greater emphasis is being placed
and groom future leaders of the bank.”              satisfactory for over a period of time. The        on employee health and well-being. The
    The LDP consists of 3 phases – phase            tools are intended to identify participant’s       bank has appointed several change agents
1 entails the administration of online tools        behavioural and technical skills and               to drive the amalgamated organization’s
(psychometric assessments, situation                competencies. Dhanaraj underlines:                 new vision and mission.”
judgement test, managerial aptitude and             “These tools are robust and provide a                  Indian Bank has been maintaining its
leadership simulation tests). Dhanaraj adds:        comprehensive analysis of the participant’s        database in SAP (systems, applications, and
“The phase 2 entails a set of TBEIs (Targeted       behavioural tendencies.”                           products) through which training data for
Behavioral Event Interviews) and GDs (group             Indian Bank conducts knowledge tests           any period can be fetched. Dhanaraj states:
discussions) for the top 250 participants.          4 times in a year. The LDP is conducted on         “The details of untrained employees for any
Phase 3 consists of panel interviews                a yearly basis, and the validity of such test is   period can also be obtained from SAP.”
conducted by the senior management.”                3 years. Dhanaraj informs: “The content of
                                                    each of the online tools would be regularly        PERSONALIZED PLAN
MAPPING COMPETENCIES                                updated to ensure the tools are in line with       The details of certification courses completed
The bank gives score for knowledge test             market best practices.”                            by the employees is also maintained in SAP
at the end of each training program. For                                                               by the bank. As part of LDP, all participants
Leadership Development Program, each tool           ROBUST TECH, INFRA                                 receive individual development reports,
has been mapped to specific competencies.           The bank conducts knowledge tests online           highlighting their areas of strength and
Dhanaraj explains: “Participants are then           and they are created in-house. As the LDP          development. Dhanaraj emphasizes: “Each
scored on a scale of 1 (novice) to 5 (expert).      is a large exercise, being administered for        participant will create a personalized
After competencies of business acumen               800 officers across various locations in           development plan, mapped over a 9-month
and inspirational leadership are being              India, robust technology and infrastructure        period. The intent of the personalized
measured by the Psychometric Assessment             is of paramount importance. Dhanaraj               development plan is for participants to
Tool, the participants score at the sub             updates: “Phase 1 of the LDC has been              identify various tips and guidelines.”
competency level is averaged, to arrive at          conducted online without any technological                          mehul@bankingfrontiers.com

14    Banking Frontiers        December 2021
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