Find out how Shalinee Mimani, Chief Risk Officer is taking risk management to the next level at Godrej Capital:
Ravi Lalwani: Over the past 12 months, what technological advancements and innovations has Godrej Capital implemented to enhance its risk management capabilities?
Shalinee Mimani: Over the past 12 months, Godrej Capital has implemented several technological advancements to enhance its risk management capabilities. One notable advancement is the adoption of digital capabilities, which have helped streamline the process of capturing and validating customer information, frictionless onboarding process, faster turnaround times, and superior customer experience. We had introduced zero-touch mortgage loans which helped us navigate the pandemic challenges and we witnessed a good adoption in the last 12 months.
We have also implemented an agile decision engine that helps implement complex risk models and facilitates quick policy changes. This technology has enabled us to adapt to changing risk landscapes more quickly and efficiently. It has helped us in launching different products with different risk profiles.
Godrej Capital has also implemented a zero-touch reporting environment to improve decision-making with real-time insights into risk metrics and performance indicators. Lastly, as early adopters of Snowflake, Godrej Capital has benefited from improved data warehousing capabilities, enabling more efficient data management and analysis for risk assessment and mitigation.
Looking ahead to the next 12 months, what technological initiatives is Godrej Capital planning to further strengthen risk management? What improvements do you anticipate from these initiatives?
Looking ahead, Godrej Capital plans to invest and strengthen its risk management infrastructure. We will be harnessing the power of AI & ML in our risk management practices. The objective is to enhance data-driven decision-making and strengthen risk management. One key initiative is the implementation of machine learning algorithms for predictive risk modeling. These algorithms will help anticipate and mitigate risks more effectively by analyzing historical data and identifying patterns indicating potential future risks. We combine our in-house capabilities with strategic partnerships to fulfil our AI & ML needs. Our internal team is responsible for building and developing ML models, while we work with a partner for AI assistance related to credit, ensuring the best outcomes.
We are also looking forward to exploiting the potential of India Stack technologies such as Account Aggregator which will facilitate secure and quick customer onboarding, minimizing fraud.
Additionally, we intend to use alternate data sources and Gen AI for enhanced risk assessments. Investments in cybersecurity will be further prioritised as protection against ever-evolving cyber threats. Self-service analytics will deepen our data-driven strategies and empower teams with data insights for better risk management decisions.
Overall, these technological initiatives are anticipated to significantly impact Godrej Capital’s risk management strategy, enabling more proactive risk mitigation and a move towards a unified intelligent tech ecosystem.
In terms of personnel development, what initiatives has Godrej Capital undertaken in the past year to build and enhance skills in the risk management team? Have there been any changes in team structure or roles to adapt to the evolving risk landscape?
Godrej Capital has undertaken several initiatives to build and enhance the skills of its risk management team. One key initiative has been the implementation of regular training programs and workshops focused on emerging risk management trends and technologies. These programs aim to keep the team updated with the latest developments in the field and enhance their skills in risk assessment and mitigation.
Additionally, professionals at Godrej Capital are encouraged to pursue relevant certifications and professional development courses to further enhance their skills and knowledge. This focus on continuous learning has helped the team stay agile and adaptable in the face of the evolving risk landscape.
Furthermore, our team’s capabilities are segmented into key areas that directly influence risk, including credit, collections, data analysis, and automation. This integrated approach enables us to conduct thorough risk assessments, leading to a significant reduction in our delinquency rate. We also emphasize cross-functional collaboration within and across teams and departments to effectively address complex and interconnected problems.
Considering the regulatory landscape, what notable changes have you implemented in the past year that have influenced the risk management practices? How has the organization responded to these changes?
In the past year, several notable changes in the regulatory landscape have influenced our risk management practices. One significant change is the applicability of Scale Based Regulations, which have introduced new compliance requirements for the company. Godrej Capital has responded to these changes by ensuring compliance with all requirements, thereby enhancing its risk management practices.
Additionally, new norms for IT outsourcing and IT Governance Risk and Control have been implemented. The company has been proactive in implementing several customer protection measures, such as resetting floating rates and adhering to timelines for the return of documents.
In context to the regulatory focus of Reserve Bank on prudential guidelines, the conduct of business regulations as well as cyber-security, align with Godrej Capital’s high-focus areas. We have taken measures to ensure compliance with all the regulations and enhanced risk management practices in these critical areas.
Looking forward, are there any anticipated regulatory changes in the next 12 months that Godrej Capital is preparing for? How do you plan to adapt your risk management approach to accommodate these changes?
Looking ahead, Godrej Capital is preparing for anticipated regulatory changes in the next 12 months by focusing on several key areas. We have deployed an enterprise-level risk management framework which gets validated every year to ensure all identifiable risks are covered and mitigated both current as well as expected. We believe in responsible lending and ensure all our products and processes are aligned with regulatory requirements and business objectives. Our risk management team is implementing robust guardrails and controls.
In terms of issue identification and resolution, we are enhancing capabilities to quickly identify and resolve issues through improved monitoring and reporting mechanisms. This includes implementing robust portfolio monitoring capabilities and early warning signals (EWS). The software for EWS was developed internally.
The company is also making its systems ready to evolve with the changing regulatory landscape by investing in flexible and scalable technology solutions.
What initiatives or changes have been implemented in the past year to streamline processes and enhance efficiency?
In the past year, Godrej Capital has implemented several initiatives to streamline processes and enhance risk management efficiency. One key achievement has been the adoption of tools and technologies to streamline operations. For example, Godrej Capital has built tech-enabled verifications, and RPAs to improve workflow efficiency, reducing manual effort and enhancing accuracy.
Has Godrej Capital engaged consultants in the past year to augment its risk management? What specific projects did these consultants assist with, and what value did they bring to the organization?
Godrej Capital has been engaging with leading consultants and external advisors to implement various industry-best practices in risk management. We work extensively with credit bureaus to build scorecards for acquiring our customers. We have also built an in-house analytics capability for developing scorecards basis our portfolio reads. This has allowed us to tailor our risk management models more closely to specific needs and risk profiles. We continue to explore the best practices in the industry with the help of industry experts and also build in-house capabilities.
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