Customer databases are becoming commodities: Paul Thomas

Reported by: |Updated: October 11, 2020

Paul K. Thomas, MD & CEO, ESAF Small Finance Bank, speaks about the impact of covid on business and data management: 

Paul K. Thomas, MD & CEO, ESAF Small Finance Bank


ESAF Small Finance Bank’s deposits have registered an increase of 63% to Rs7.03 billion and advance by 37% to Rs6.8 billion during the year ended 31 March 2020. Its net profit rose to Rs190 million during the year compared to Rs90.3 million recorded the year before. The business during the year too increased by 49% to touch Rs13.8 billion. The bank intends to take a call after September about its proposed IPO of Rs976 million. As part of its commitment to going public by listing its stock in line with requisite guidelines, the bank had filed a draft Red Herring prospectus (DRHP) in January and subsequently got approval from market regulator SEBI in March. Paul K. Thomas, the bank’s MD & CEO speaks about the role of data management in driving the growth of the bank.

Ravi Lalwani: The covid pandemic and the lockdown crisis have shaken every BFSI organization and all such organizations have decided to become even more data-centric. What is the immediate impact on data management in BFSI organizations and what are the most common responses?

Paul K Thomas: In the BFSI sector, the core business data emanates from within and we have a system for digital transmission and exchange of data. The covid scenario has not impacted much on the internal data generation and sharing. There is some delay in getting the industry level impact of business on these sectors.

In what ways will data management cope with the sudden increase in volume, velocity, and variety of data, over the medium term? What regulatory guidelines have impacted data management in the last 6 months?

There has been no sudden increase or decrease in the volume of business but there is a slowdown, which is across all sectors of business, and BFSI is no exception. Regulatory guidelines in data definition and classification of assets have been well laid down and there is no ambiguity in data management, but we have seen some shifts in customer behavior.

Is data expected to remain concentrated in the data centers, or be more widely distributed at the points of consumption? If it is the latter, what kinds of tools will be required?

Organizations like banks have adequate data handling tools in place. However, there is no pattern or precedence to project the outcome or predictive analysis, which remains fluid, across all sectors and equally challenging and baffling like the spread in covid pattern and its futuristic impact.

When procuring new software, the questions to the vendor were mostly related to functionality, performance, security, etc. What data-related questions are being asked nowadays?

In the present-day context, software and hardware tools are flexible, easily scalable with cloud, and open-source architecture in place. We believe that it is the right time to look for opportunities rather than the threat perception, along with hand-in-hand progress.

What are the ethical questions that are being raised regarding data, within financial organizations, and by society at large?

As we race towards digital adoption, data security, privacy, and intellectual property rights are becoming key concern areas. In the financial sector, customer databases becoming commodities are challenging concerns that need to be addressed.

Please share some recent initiatives taken by your bank to promote digital and fintech entrepreneurs.

Digital channel is a key component of the bank’s strategy, and over the years it has leveraged digital platforms for all its services. The bank is now aiming to look beyond this and wants technologically advanced solutions and its extensive applications to help customers build sustainable livelihoods. Fintech Conclave 2020 would be a platform for such digital entrepreneurs.

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