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Dual approach for technology implementation

Vijaya Bank is readying for a technological transition. The bank’s MD and CEO Kishore Kumar Sansi believes this will place the bank in an enviable position, especially catering to the needs of the GenNext customers

N. Mohan: What are the major factors that distinguish Vijaya Bank from other banks?  What are the strength areas of the bank that helped it to reach its level of efficiency?

Kishore Kumar Sansi: Vijaya Bank has some inherent strengths, which make it different and more vibrant from other public sector banks.  The branch network of the bank is well spread geographically and is pan-India. While in the five southern states, the bank has about 45% of its branches, the remaining 55% branches are spread across Northern, North-Eastern, Western and Central parts of the country, covering all 29 states and union territories. We have opened 246 new branches during the last fiscal, probably the largest among peer group. The asset base of the bank is well spread with priority sector and retail credit contributing 41% and 26% of total credit respectively, which is again among the highest in the banking industry. The bank is well capitalized with a total CRAR of 12.58% and the Tier-I capital exceeding 9.45% as on 31 March 2016. We have one of the strongest IT platforms, both for customer-centric applications and for the work-flow based back end operations.

We have one of the youngest work forces among the PSBs, with the average age of employees being about 38 years. The young, skilled and highly motivated work force is our main strength.  With the average age of employee on the bank’s side, the adaptation of technology is fast. Most of the decisions taken by executives at various levels are dash-board based, which is made available on real-time data.  The highly committed team of top level executives, supported with meticulous planning and equally good execution, makes the bank perform efficiently under most of the parameters. The bank is fundamentally strong and is poised for a steady and continuous growth on all parameters.

Has the bank at any point felt that its human talent had lagged behind? What are the measures that the bank is initiating in order to make its personnel perform in a competitive environment? 

We have a good balance of experienced and young work force.  More importantly, there is a close bonding between

Kishor Kumar Sansi emphasizes that the bank will move ahead with the 'Mobile First' strategy, to help large population to do banking through handset

Kishor Kumar Sansi
emphasizes that the bank will move ahead with the ‘Mobile First’ strategy, to help large population to do banking through handset

the young and the experienced and the level of interactions between the two is extremely high. We have a highly committed top management comprising 14 general managers, supported by adequate number of second line executives in all functional areas.  The continuous skill upgradation of executives and the employees at all levels ensures that each employee excels in his/her area of operations.

We have put in place a mechanism of competency mapping, making sure that the right employee is put on the right job. Further, the continuous upgradation of skills through on-work and class room training, both at premier institutions of the country and overseas, ensures that motivated and trained manpower is available in each area of operation. Special focus is given to nurture talent in specialized areas of operations such as Risk, Treasury, Technology, etc.  For each specialized area, a pool of trained employees has been identified with a separate career and growth path.  We are also making extensive use of technology to upspeed the knowledge and upgrade the level of employee skills through e-portals, apps, e-learning, etc which results in optimum utilization of our workforce. Hence, the bank has not really felt that its human talent has lagged behind in any area.

What are the bank’s focus areas? What customer segments will fuel most of the growth?

Keeping in view the prevailing overall macro and micro economic scenario within the country, we expect that during the current financial year the demand from the corporate sector would remain muted. Major sectors such as iron and steel, textiles, power, etc have yet to pick up.  Accordingly, we will put in focused efforts to further increase the share of business from retail, priority and mid-corporate segments. Having seen more than 30% growth, both in housing and vehicle finance during the last fiscal, we are confident to further improve the performance in the retail sector during the coming years. Concrete initiatives are also being taken to substantially improve savings deposits which has seen a growth of more than 18% during the last financial year.

We plan to extensively use data analytics for cross-selling of the products to the existing customers, besides capturing new customers into our fold. With the extensive use of technology, especially mobile banking, which has seen manifold increase during the last financial year, we plan to put in more focus on the high income group customer segment in the age band of 25-40 years.

Can you speak in detail about the technology transformation that the bank is undertaking and which is inevitable for any bank in India to be relevant in the years to come?

Vijaya Bank has adopted a dual approach for technology transformation.  While we appreciate the need to deliver more and more IT based products and services to the customers on an ongoing basis, we feel it is equally important that technology should be adopted at the back office and the administrative offices of the bank so as to derive the best benefits from IT at all levels.

We have exponentially expanded the use of mobile banking among customers which has grown from a modest 50,000 active users to more than 5 lakh users during the last financial year. With this steep increase, we have attained the No.1 position in the use of NPCI’s NUUP based mobile banking in the industry. The transactions through mobile have increased to an all-time high of 90,000 per day, amounting to Rs25 crore. Similarly, the net banking penetration has also increased significantly during the last financial year, both for personal and corporate users. We would continue to expand usage of mobile and net banking across the customers while ensuring availability of more app based products for the customers on this platform on an ongoing basis.

The Bank also plans to expand use of the work-flow based applications at the back-end to improve the decision

Centralized Surveillance facility for ATMs of the bank

Centralized Surveillance facility for ATMs of the bank

making process. The extensive data of more than 15 million customers for the past 10 years would be made use of for providing differentiated sets of services, besides cross-selling of products to the customers. We also have plans to make use of Intelligent Fraud Management Systems for minimizing the risks arising out of technology and banking operations.

Having launched the first Digital Village recently in Mandya district in Karnataka, we are all set to replicate this model of digitization of FI villages to other areas thereby supporting initiatives of the government of India on financial inclusion and Digital India. Vijaya Bank was among the first to computerize the top 30 processes of the bank, as per the deliberations held at Gyan Sangam-I, resulting in marked improvement in customer services. We are also taking initiatives to empower customers to do their banking transactions on their own as per their convenience through various platforms such as e-lobbies, ATMs, self-service kiosks, Tab Banking, etc, for increased customer delight.

While ensuring extensive use of technology at all levels, we are also seized of the emerging cyber threats for which we have set up a Cyber Radar, which throws alerts of any wrongful access to our sensitive IT systems. Having built a comprehensive cyber threat matrix, we are providing a secured, efficient and state-of-the-art services to the customers by using contemporary IT platforms.

What is the current level of technology induction in the bank and what it would be say in five years from now? Will this usher in a paperless bank ultimately?

Adoption of technology for us is one of the prime focus areas.  We believe in continuous upgradation of technology, which ensures not only availability of the best products to the customers at the shortest possible timeframes, but also ensures that the bank is taking advantage of latest technological platforms. Innovation is a key driver for the deployment of technology.  While ensuring adequate security, we are planning to move more towards app based IT platforms, which facilitate quicker launch of products to meet the needs of different segments of customers.

We are making extensive use of digitization of documents for their security and quicker retrieval.  We are moving towards straight-through processes by integration of different payment systems and electronic delivery channels. We expect more than 80% transactions shall be conducted outside the brick and mortar structure of the bank in the times to come. Data analytics would be a key driver for cross selling, product evaluation, increased profit and for intelligent decision making. All these innovations will lead to the less-paper operations within the organization.

What are the core areas that you focus in this technology transformation – digital as a whole, mobility, self-service, customer delight?

Digitization per se encompasses areas such as mobility, self-service and computerization of umpteen number of front and back office processes to increase customer delight. We expect to move ahead with the ‘Mobile First’ strategy as we feel that a large population of the country would be empowered with the smart phone sooner than later, which would enable them to perform banking operations through handsets.

With the recent launch of Unified Payment Interface by NPCI and Vijaya Bank being one of the forerunners in its adoption, mobile banking is going to transform the face of banking. With this, we would offer not only latest mobile based applications to the existing customers, but customers of other banks will also be prompted to adopt our mobile based applications and services. Besides, with dashboard based decision making already available with us, more and more artificial intelligence based technologies would be adopted, both for intelligent data analytics, MIS and e-surveillance of branches and ATMs.

Do you think it is relevant to initiate technology projects keeping in mind the fact that ultimately it is the mobile that is going to be the preferred medium for transactions?

Besides providing efficient customer service, we are making active use of technology for various back office and administrative applications. For this, continuous innovation and initiation of new IT projects is inevitable. It would be prudent for a bank like ours to innovate and adopt latest technological tools and IT platform for which mobile could be one of the prominent delivery channels.  Hence, we at Vijaya Bank, firmly believe that adoption of newer and newer IT platforms would be necessary to remain frontrunners in the industry.

Do you think being a public sector bank has hampered your efforts in digitization?

During the last one decade, Vijaya Bank has been in the forefront as far as adoption of technology is concerned.  The apt directions and continuous support from the board of the bank ensures that the bank always remains updated on the various technological initiatives, as it improves the customer base, besides optimizing the operational costs. With a clear focus on technological upgradation, budget has never been a constraint and IT is being expanded to all the required areas on an ongoing basis.

Can you speak about the products that the bank intends to come out with in consonance with technology induction?

We will continue to invest in remittance and payment systems. We feel that there is immense market to replace cash through remittance based applications such as mobile wallet, digital wallet, etc. The ease of use and convenience to the customers would be the prime drivers for launching newer remittance and payment based solutions for the customers. This would also result in improved float and increased non-interest income. Big data is going to be of immense interest to us as this would provide meaningful information about customers, besides prompting us to come out with more and more new products and services for each differentiated set of customers.

Inauguration of the first digital village by a PSU bank at Chandagalu village in Karnataka

Inauguration of the first digital village by a PSU bank at Chandagalu village in Karnataka

We also plan to deploy more intelligent ATMs and kiosks, so that besides doing the mundane cash dispensation and acceptance activities, these should provide more valued based services to the customers. The emphasis would also be on the web-based applications so that the customer can do banking transactions as per his convenience, in a secured environment. We have plans to venture into social banking infrastructure thereby targeting young tech-savvy prospective customers and bring them into the fold of Vijaya Bank.

What are your plans for mobile money? Do you intend to launch a mobile wallet?

As I mentioned earlier, we are firming up on the ‘Mobile First’ strategy as we expect that mobile would be the most acceptable platform for conducting secured transactions in times to come.  Mobile banking per se includes mobile to mobile transfers through the mobile wallet, which would go a long way in minimizing the cash transactions. The mobile wallet is also available as an accepted fund transfer facility for our customers and more and more variants would be launched in the years to come, to meet the requirements of the customers.

What has been the volume in terms of number and funds of your internet banking transactions? Do you think with the mobile revolution happening, internet banking will lose its current status as the most preferred channel among the GenNext customers?

During Jan–Mar 2016 quarter, there were about nine lakh financial transactions amounting to about Rs6500 crore through net banking. Our upgraded net banking is mobile responsive and can be seamlessly accessed across any hand held device. We have seen a surge in growth in our net banking customers and the increase in mobile customers has been phenomenal. Having made our net banking responsive has also increased its usage through mobile devices. Internet banking having more stringent security features and having a host of checks and controls is emerging as the preferred mode for corporates and those making large payments, while mobile app would be preferred by customers for small volume transactions. Both the modes can co-exist and can be interchangeably used by our customers.

Can you speak about the products and services that you offer to your corporate clients making use of

 Eugene Kartak, Regional Director, RBI inaugurating an e-lobbies of the Vijaya Bank

Eugene Kartak, Regional Director, RBI inaugurating an e-lobbies of the Vijaya Bank

technology? Is the bank planning to have a mobile banking facility for the corporate?

We foresee convergence of mobile and internet banking as most of the internet banking operations will be transacted

through handsets.  While most corporate businesses would be internet based, most private business transactions, in the personal banking space, will be through mobiles.  We, therefore, see more convergence towards mobile banking.


What are the new security systems that you intend to implement as you proceed with your digital initiatives?

We are one of the first public sector banks to have a dedicated Security Operations Center (SOC) manned by top notch IT security professionals. We have implemented Defence Depth Architecture with secure infrastructure across various levels and Incident Management Solution (SIEM) with vulnerability scanners. We have recently won the IDRBT Best Bank Award for Cyber Security and Risk Management among mid-sized banks and DCSI excellence award for security.

In the past few months we implemented various technology solutions to secure our infrastructure from internal and external threats. We have evaluated the threats in terms of attacks emanating from external factors such as hackers and fraudsters with malicious intent and also risk emanating from internal employees / outsourced personnel having access to critical devices/ applications/ data.

During last financial year, we have invested significantly in upgrading the security infrastructure to counter various cyber threats and also implemented solutions to improve internal controls for access. We will soon have a fraud risk management system to provide greater security to our customers.

What are the plans for self-service banking?

To provide banking experience with all essential banking facilities under one roof beyond the normal banking hours, a number of e-lobbies have been opened which are equipped with:

  • ATMs
  • Internet banking kiosk
  • Passbook printing kiosk
  • Cash deposit kiosk
  • Coin vending machine
  • Cheque deposit kiosk etc

We also offer online banking, tab banking and e-KYC for quick account opening.

Is the bank considering virtualization technologies? If yes, which are the priority areas?

In order to optimize the power consumption and space utilization, we feel that adoption of virtualization is inevitable.  As a first step, we have already initiated action in virtualization of data center, thereby resulting in huge savings in power and space. Similar concept is also being extended to the branches where we are going for virtual desktop interface, thereby eliminating the need for desktops. We are confident this initiative will go a long way to support green initiatives and reducing carbon footprints besides optimizing space requirements.

Do you have plans to upgrade your CBS? If so what would be the salient features of the system that you propose to adopt? Do you have data warehousing facilities?

Adoption of newer technology is an ongoing activity for us. We feel that we should take proactive steps for upgrading to the latest platforms instead of the same being driven by fear of obsolescence.  Accordingly, we have prepared a roadmap for upgradation of various applications, including CBS, 3rd party products, trade finance and other related areas.

We possess 10 years of historical data of more than 15 million customers and the latest analytical tools are being used to convert this data into intelligent information. This intelligent information is helping us to come out with newer products and services besides differentiation of the customers and their requirements for customized products based on the profile. This data warehousing would be made more comprehensive so as to derive more diversified information in times to come.

Finally, can you narrate the technology vision of the bank in the context of offering more and more digital services?

Technology is going to greatly dominate the landscape of banking in times to come. Right from customer acquisition to data analytics, AI based dashboards and up to cyber security and e-surveillance, IT is going to play a dominant role.  Accordingly, the bank has been positioned to adopt and innovate to derive best advantages from contemporary technology. We feel that sooner than later there is going to be larger convergence of banking and technology so that we become a fintech organization to offer best of banking services through contemporary IT tools.


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