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Cosmos Bank revamps digital agenda

Rolls out online, mobile and social banking extensions to core offerings:

Milind Kale

Cosmos Cooperative Bank has 140 branches and 138 ATMs. It is planning to add 10 mobile ATMs as well as 40-50 recyclers with the cash deposit facility. Chairman of the bank Milind Kale says the bank has designed the infrastructure considering the growing customer transactions on digital platforms in the next 5 years. The bank’s daily average count of NEFT transactions has increased to 14,528 in FY19 (amounting to Rs1.49 billion) from 8689 in FY17. Similarly, daily RTGS transactions too have increased to 1554 (amounting to Rs4.17 billion) from 1276 during the same period. IMPS transactions have more than trebled to 4116 (amounting to Rs50.01 million) and UPI transactions to12,161 from just 863 2 years ago.


The bank has revamped its agenda for digital banking. Kale says the bank has rolled out online, mobile and social banking extensions to the core offerings in an effort to respond to the changing consumer demographic. “We have gained several benefits with strategic use of the technology, which include improved usability by the customers, securing the engagement experience, operational excellence, reduced turn-around time, reduced cost of operations and leveraging location-based personalized services,” he adds.

While these IT initiatives are available to customers, the bank has found that UPI is gaining popularity among the customers. Youngsters as well as middle-aged customers prefer the user experience of net banking as well as NEFT/RTGS. Kale says considering the growing popularity of the UPI platform, the bank has launched SoPay, a new digital payments application, developed on UPI platform and available for both Android and iOS users. SoPAy is different from a mobile wallet in the sense that one cannot store money in the wallet and money is deducted or added directly from customer’s bank account. It allows users to send money, receive payments directly into their bank accounts or make payments for purchases made at stores that accepts UPI-based transactions. The user has to link his bank account with SoPay by entering UPI pin before making transactions through the app. Says Kale: “Transactions made using SoPay are simple, safe and quick. The app comes with a range of innovative features, like direct transactions from and to bank account and instant money transfer.”

“Because of the lockdown and closure of industries and businesses, people have no chance to do transactions other than for buying essential goods, and accordingly we have observed a decline in digital transactions,” observes Kale.


To align with the bank’s business strategy, the bank’s IT team has created a wide variety of digital offerings for customers – UPI, AEPS, tab banking, mobile banking, eKYC, NACH, APBS, IMPS, customer communication portal, eLocker, internet banking, self-service customer kiosk, CRM and lead management solutions, RuPay and Visa debit cards, ATMs, PoS, alert facility, cheque truncation system and straight through SWIFT, NEFT and RTGS services. The bank’s IT capex for the last financial year was Rs140 million and opex was Rs280 million. In the current year, the bank has budgeted a capex of Rs150 million and opex of Rs300 million for digital initiatives.


The bank’s employees are using tablets, micro ATMs and mobile ATM vans for offering various services to customers since 2016. Kale says by bringing in paperless account opening in the under banked and unbanked areas, customers can now open an account by using their Aadhaar number and biometric/OTP authentication. At micro ATMs, customers can withdraw and deposit cash and make various utility bill payments, recharge their TV and mobile connections. Various account servicing requests such as balance enquiry, mini-statement and account updation can be done at these micro ATMs, putting banking services within easy reach of customers.

Direct benefit transfers of government welfare schemes into beneficiary accounts are also done through the micro ATMs. At origination ends of remittance corridors, customers can now easily remit money to bank accounts of beneficiaries across the country through micro ATM, while at the receiving end, beneficiaries can easily access their accounts to withdraw the same at the local Cosmos Bank micro ATM.

Kale lists certain key advantages for the bank in equipping employees with electronic gadgets: “We can offer additional services like cross selling of products, expand our services to remote and rural areas and undertake the vital exercise of financial inclusion and provide safe and efficient mechanisms for making and receiving payments with minimum risks to the bank, service providers and end customers. Besides, paperless transactions are possible, achieving reduced turn-around time, and increased customer satisfaction even while reducing infrastructural cost and increasing customer loyalty.”


In 2019-20, the bank opened 7250 online FD accounts, amounting to Rs771.7 million, and 1892 online RD accounts, amounting to Rs6.3 million. In the current FY as of June 2020, the number of FD accounts opened were 2198, amounting to Rs226.6 million and 487 online RD accounts, amounting to Rs1.6 million. Kale feels that the irregular income or curtailment in employment, would lead to decrease in monthly income of people and this may have a huge impact of small savings and large investments by various customer segments. “We have not introduced online credit but offered new schemes to avail the special credit – like 10% ad hoc limits, curtailment in margins, etc,” says Kale.


Kale emphasizes that the bank has almost all the digital products that banks normally offer. “We will now focus on better penetration among various customer segments and create awareness about the use of digital platforms for day to day transactions,” he adds.


Cosmos Bank conducted trainings for its own staff and those of other UCBs on topics like digital banking transaction flow, card issuance and c acquisition, UPI, IMPS, EMV, NFC, QR code, fundamentals of card issuing business, technical risk associated with various digital payment systems, security measures to be implemented by the banks and cyber security. Kale says the bank would like to conduct training for its own staff on topics like fundamentals of digital payments and available channels, National Financial Switch providing interoperability for ATM transactions between banks, ATM service management and best practices, card schemes & settlement for Visa, Mastercard, DFS, JCB, CUP, Amex and RuPay; Card Scheme & Settlement of RGCS (RuPay Global Clearing & Settlement) for transactions done on POS & ecom channels by using different cards, DBT, services available through internet and mobile banking and platform used for cashless transactions using RFID Tag.

Trainings, he believes, will help product penetration and create safety and security awareness and new business opportunities. “We want to train our staff on the existing digital channels in details in order to increase the penetration of the e-banking products and services. We like to create awareness about the technical risk associated with various digital payment systems and security measures to be implemented. Also, there is a need to train staff at branches on how to onboard societies and merchants onto the new channels by using third party UPI application TimePay.”

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