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Mahila Banks ramping up technology & security

These women banks motivate as well as train their customers to use modern technology:

The Mann Deshi Mahila Sahakari Bank was set up in 1997 after Kantabai, a welder who worked and lived with her family on the footpath in Mhaswad, rural Maharashtra, approached Chetna Sinha. She narrated a harrowing account of being rejected by several banks when she tried to open an account. Kantabai simply wanted a safe space to save some money so she could buy tarpaulin sheets to protect her home in the monsoons. Chetna Sinha decided to set up a bank for women like Kantabai. 1335 women pooled their savings (Rs0.78 million) and set up the first bank for and by rural women in India. It remains a member-driven and member-owned bank.

The Udaipur Mahila Samridhi Urban Cooperative Bank, established in 1995, was founded by Kiran Maheshwari, who became its first chairman, with Kiran Jain being the first vice-chairman. The bank has made a remarkable progress during the last 27 years of dedicated services in its all products and schemes for women.

Laxmibai Mahila Nagrik Sahakari Bank, popularly known as Laxmi Bank, became the first co-operative bank in the entire central India in 1998, to be accorded the scheduled status by Reserve Bank of India. The chairperson of the bank Alka Shrivastava herself has been taking keen interest in providing affordable banking to the downtrodden women and empowering women in SHGs to be independent.

Konoklota Mahila Urban Co-operative Bank of Jorhat is taking a prominent part in upliftment of economic status of women since 1998. It is the only all women bank in Assam and one of its kind in entire North East India. Sakuntala Devi is the chairperson of the bank.

Chetna Vijay Sinha, founder as well as chairperson and Rekha Sunil Kulkarni, Chief Executive Officer, both of Mandeshi Mahila Bank; Vidhya Kiran Agrawal, chairperson of Udaipur Mahila Samridhi UCB; Alka Shrivastava, chairperson of Laxmibai Mahila Bank and Lakhimi Baruah, Managing Director of Konoklota Mahila UCB, talk about their bank’s progress in digital transformation and measures taken by the respective banks to improve their cyber security:

Mehul Dani: What is the bank’s progress in technology modernization and digital transformation during the last 12 months?

Chetna Vijay Sinha (Mann Deshi): The bank has implemented a range of digital initiatives during the last 12 months. This includes mobile banking application, UPI integration and QR code for micro business customers. The bank has shifted to a new CBS with enhanced customer service, business correspondence interface and security. We have appointed business correspondents in remote villages with all the services available with limits. We are not only making this modern technology available, we are also motivating and training our customers to use it. We continuously provide financial and digital literacy to our customer. As a result of these efforts, we see that trend of adoption of this technology is increasing day by day. The queue in branch has reduced considerably.

Vidhya Kiran Agrawal (Udaipur Samridhi): The bank has adopted the latest technology in routine banking and does regular updates in the hardware as well as software systems. The bank has provided the customers a digital platform for safe and faster banking activities like fund transfer, fund received, bills payment, etc. The bank has reconciled all type of digital transactions on the daily basis and it updates the customers’ accounts.

Alka Shrivastava (Laxmibai): Post covid and due to changes in banking regulations by RBI & cyber security, we had to undergo upgradations in our core banking systems. We are focusing on infrastructural upgrades to our core systems. The trend and investments have now shifted to the modernization of the underlying systems, supporting these data-centric, front-end user experiences. We are also enhancing our systems to enable new age online banking services.

Lakhimi Baruah (Konoklota): Our bank has implemented core banking system. The bank is a member of NACH platform and PFMS enable under IDBI sub-membership. NEFT/RTGS and CTS clearing under sub-membership of Yes Bank. The necessary step of upgradation for technology modernization and digital transformations are being taken from time to time and also during the last 12 months.

What steps has the bank taken to improve its cyber security?

Rekha Sunil Kulkarni (Mann Deshi): The bank is implementing SOC (Security Operation Centre) at bank site to improve cyber security monitoring system. IT team is being strengthened. Proper staff accountability has been fixed. On time, training is imparted to staff. Customer awareness program is an ongoing process. Following are other features of our cyber security component: (i) Dedicated line for CBS application (ii) Security patches are installed in monthly interval (iii) All application run in https (iv) Mail PC is separate from operation PC (v) Static IP (vi) Using firewall for layer 3 security (vii) Using only SSL certificate on net application (viii) All system is in domain (ix) Dual authentication (x) No RTGS/NEFT after 7 PM (xi) KYC data is encrypted (xii) Masked debit card number (xiii) All passwords are saved in encrypted form.

Vidhya Kiran Agrawal (Udaipur Samridhi): We have taken following improvements for cyber security: (i) DMARC, DKIM and SPF on bank domain with anti-phishing and anti-malware solution (ii) Inventory management with the help of software (iii) Replaced the firewalls with FortiGate at all locations in HA mode (iv) Updated the antivirus solution with DLP feature on Cloud Solution and (v) Centralized log collection of all the network devices.

Alka Shrivastava (Laxmibai): We have implemented 2-factor authentication in our systems. We have increased security from cyber threats with firewall and end point security solutions.

Lakhimi Baruah (Konoklota): The bank has taken step to protect from cyber security threats with the vendor ‘Bharat Cores’ during the last 12 months.

What progress have you seen in adoption of digital payments among your customers?

Chetna Vijay Sinha (Mann Deshi): We have seen an exponential growth in digital payment being used by our customer. This includes UPI and mobile banking. Since start of covid, this payment gained stupendous growth. 2 years ago, there was reluctance in our customers to use this technology. They had a fear of unknown and loss of money in transaction. Customers hardly had any smartphone. We design our training on digital with dummy component, which our customers first use. When they have confidence, they gradually use this technology.

Vidhya Kiran Agrawal (Udaipur Samridhi): The bank has seen significant progress in adoption of digital payments by customers. They use multiple digital platforms for routine transactions like mobile banking, UPI, BHIM, Google Pay, IMPS, etc.

Alka Shrivastava (Laxmibai): During covid pandemic, digital payment solutions have become more prominent due to its contactless nature. Online shopping has become a preferred way to buy, and therefore digital and mobile payments, digital wallets & UPI are preferred which can be used directly from their phones.

Lakhimi Baruah (Konoklota): It is found that digital payment provides opportunity to have clean payment in a short time, without any middle help process among the customers.

What training have you conducted to improve employee knowledge in order to minimize cyber security threats?

Rekha Sunil Kulkarni (Mann Deshi): The bank continually trains its staff to minimize the cyber security threat. A few of the training contents are as follows: (i) Unkown domain mail (ii) Password security (iii) File locking (iv) The bank arrange periodic training to board of directors also (v) Guest lectures.

Vidhya Kiran Agrawal (Udaipur Samridhi): As per RBI guidelines, our bank follows the circulars of cyber securities for educating the employees. The bank management and IT team conducts the training programme for staff members, where a trainer, having specialised knowledge in this field have taught them about the system hacking, securities system, how to detect fraud in day to day working, how they can secure their system, mail etc.

Alka Shrivastava (Laxmibai): Cybersecurity training has been conducted and is mandatory for all employees at every level. This means that anyone using a computer should know how to identify phishing schemes and social engineering attacks. If these things are not easily identifiable, they may go overlooked and wreak severe havoc. These attacks can happen via email, unidentified links, etc. All employees have been trained to identify and avoid suspicious links and, since phishing attempts are on the rise, they have been trained to evade hacking attempts and informed of secure browsing practices.

Lakhimi Baruah (Konoklota): In-house training is conducted to improve the employees’ knowledge in order to minimize cyber security threats regularly. Reserve bank of India recently conducted such training program, highlighting GST for employees.

Briefly describe the campaign you have undertaken in the last 12 months to educate customers about cyber frauds?

Rekha Sunil Kulkarni (Mann Deshi): The bank and Mann Deshi Foundation both jointly create awareness through cyber security banners in branches, awareness trainings to customers in field, also we send periodic messages to customers about cyber security awareness. Through Mann Deshi Foundation, we have separate program of ‘Digital Didi’, which is about imparting digital literacy training to women by our trained staff about how to take care while doing digital transactions.

Vidhya Kiran Agrawal (Udaipur Samridhi): The bank management conducts the customers’ meets from time to time to introduce the latest technologies with securities. The bank has also provided the helpline number for customers for any query regarding the digital payment. The staff members also update and teach the customers for cyber frauds like do not share the OTP, do not share account balance, how to inform to bank in case of any fraud.

Alka Shrivastava (Laxmibai): Customers are continuously notified through messaging for a safe online banking experience. The users need to be aware of the common phishing techniques that cyber-criminals use. They attempt to gather confidential information of the user such as credit/debit card details, online banking details, account details, user names, or passwords by deceptive means. The fraudsters usually pretend to be belonging to reputed organizations or the user’s respective banks and ask for a PIN, expiry date of the ATM or credit card, online banking details, etc. To protect the account from phishing attacks, the users should stay away from strange calls and messages. They should not share login or important details including OTP by any means as a legitimate organization will never ask for such important details.

Lakhimi Baruah (Konoklota): The bank is working for SHGs and JLGs in the rural areas to organize and motivate women members as well as the small daily wage labours towards savings thrifts and their credit needs. It is a main objective to save their small earnings. The bank teaches them not to share their passbook, account number to anybody anywhere. The bank organised various financial literacy campus during last 12 months and educated the customers about cyber frauds. To protect from cyber frauds, the bank has undertaken preventive measures during the last 12 months and signed agreement with renowned vendors as per Reserve Bank of India guidance. The bank educates employees to maintain necessary secrecy and asks customers to keep the same as advised.

Briefly describe the campaign you have undertaken in the last 12 months to educated customers about financial literacy?

Chetna Vijay Sinha (Mann Deshi): The bank and Mann Deshi Foundation both jointly create awareness through staff members in field for our customers. We have 2 separate modules of digital literacy and basic financial literacy and advance financial literacy. Recently we have created a dedicated vertical that looks after the financial and digital literacy training to each customer (both credit and deposit). Our financial literacy covers following aspects: (i) Need vs. will (ii) Expenditure control (iii) Prudent use of credit and loan repayment (iv) Saving (v) Investment (mutual fund, FD and pension) and (vi) Life cycle need and financial planning. Our digital literacy covers following: (i) Mobile app use (ii) UPI (iii) Use of ATM card and (iv) Security awareness in digital literacy.

Vidhya Kiran Agrawal (Udaipur Samridhi): The bank has been conducting camps in semi urban and urban areas to educate customers about routine, regular banking. In these campaigns staff members teach the local people, especially women and girls, the benefits of primary banking like how they can open the saving account, recurring account, how they can deposit the amount safely in bank accounts and earn the interest.

Alka Shrivastava (Laxmibai): We do financial literacy campaign to promote awareness every year through a focused campaign. We organize financial literacy camps for five target groups’ viz. farmers, small entrepreneurs, school children, self-help groups (SHGs) and senior citizens. Audio-visuals have been designed for the benefit of the general public on topics relating to financial literacy. These audio-visuals are on ‘Basic Financial Literacy’, ‘Unified Payments Interface’ and ‘Going Digital’.

Lakhimi Baruah (Konoklota): As such the bank has conducted various financial camps among community of rural people linked to the bank. The bank conducted such camps in local areas at Nimati Borali gaon, Saruhuj and Borhuj gaon at Jorhat district. And the bank conducted financial literacy camps in ST located area Khutiapota, Alengmora, Nam Deuri during last 12 months.

Have you tied up with mutual funds and insurance companies in the past 2 years? If yes, then how many new customers have you acquired for these 3rd party products?

Rekha Sunil Kulkarni (Mann Deshi): The bank tied up with UTI mutual fund for its customers to investment for pension since 2006.The bank has tied up with Kotak life insurance to provide life insurance to our customer. We have 500 pension customer and 15000 insurance customers.

Vidhya Kiran Agrawal (Udaipur Samridhi): No.

Alka Shrivastava (Laxmibai): No.

Lakhimi Baruah (Konoklota): Yes, the bank has tied up with LIC Micro Insurance and Kotak Life Insurance with loan coverage. Moreover, the bank has, for PMJJY and PMSJY, tied up with LIC and Kotak Life respectively. For this purpose, agency designated staff members are trained and qualified by IRDA in last 2 years. New customers’ trend is encouraging.

What trend has the bank seen in consumption loans and business loans during the last 2 years? What trend do you expect in the next 2 years?

Chetna Vijay Sinha (Mann Deshi): We observed that in market, there are good number customers, who require consumption loans for 2 wheelers, 4 wheelers, white goods, laptop, mobile phones, etc. We look forward to increasing these types of loans in future. At present, we do not promote consumption loans in our bank.

As far as business loan is concerned, there is rising demand of micro enterprise loans from Rs1 lakh to Rs5 lakhs. Although the micro loan demand has been negatively affected by covid, cash credit to micro loan customer is also rising.

We think that in next 2 years demand of consumption loan and micro enterprise loan will rise more. The bank needs to digitize its processes to cater this demand on time. Women micro enterprise loan will have more demand with less supply as these enterprises hardly have any security to offer to banks. This will create a situation of gap in demand and supply. We think that there is a conducive requirement of an ecosystem, supported by government to meet these challenges either through change in policy or a suitable credit guarantee scheme.

Vidhya Kiran Agrawal (Udaipur Samridhi): In the last 2 years of pandemic of covid, bank has observed that borrowers required the business loan in small scale sector, and working capital to run their business. The bank expects that more loans and advances will be required in MSME sector and in housing sector.

Alka Shrivastava (Laxmibai): The bank’s CD ratio is getting better than before. The focus of the bank is on small microfinance. In this financial year, most of the finance has been done by the bank in CNG auto rickshaws and e-rickshaws, which are in priority category as per RBI guidelines. This type of loan has increased the income of the lower-class customers and they do their business smoothly by getting loan from the bank, which has benefited all the stakeholders.

Lakhimi Baruah (Konoklota): The bank does not have consumption loan. The bank has small business loan which constitute 30% of the total loan products. The bank does have SHG and JLG loans under NRLM, NULM Scheme, as targeted by the district administration. The bank also has agri and allied, SSI, Mudra loan, Weavers Credit Card (WCC) and other loans. Bank has own financing under micro loan scheme to SHGs and JLGs and also individuals as per borrower’s needs in priority sector and we expect such loans to grow in next 2 years. Over and above, the bank has OBC, SC, ST Corporation loan under micro credit policy. The bank is financially supported as MFI by SIDBI, Rashtriya Mahila Kosh (RMK), North Eastern Development Finance Corporation (NEDFI) and NABARD.

What steps has your bank taken in the last 12 months to improve compliance with RBI guidelines?

Rekha Sunil Kulkarni (Mann Deshi): The bank has migrated to new CBS equipped with timely generation of RBI report. This helps in submitting report to RBI on time. We have the RBI report calendar also to remain alert on time. Incidental report is being taken care by finance department.

Vidhya Kiran Agrawal (Udaipur Samridhi): Our bank has taken 2 main steps. First, the bank management has been educating the staff members to read and understand the RBI circulars and apply them in routine banking in all manner. Second, the bank has followed the all guidelines as per required by RBI like update the Re-KYC, Cyber Securities, system upgrades, customers awareness, etc.

Alka Shrivastava (Laxmibai): We ensure that key employees of our organization attend all the trainings, held by RBI from time to time. We also participate in various third-party trainings, so that we have all the updated information at any point of time. In order to ensure compliance with the instructions given by RBI, we are updating our system from time to time so that the mandatory and other records can easily be compiled from the CBS.

Lakhimi Baruah (Konoklota): The bank has taken various suitable steps to address the deficiencies of inspection under Section 35 as directed by Reserve Bank of India from time to time and discussed and taken measures, as suggested by Board of Directors in last 12 months.

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