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Pillars of Transformation – AI & Automation

City Union Bank is also building a middleware platform that would help third party systems and fintechs to connect with core banking and internal legacy systems:

City Union Bank has been a pioneer in implementing IT-enabled solutions for the benefit of customers who could avail banking products and services at their convenience anytime, anywhere. One of the most innovative technology products of the bank is ‘CUB All in One Mobile App’.
Sankaran G., General Manager, Computer Systems Department, describes the solution: “This is a multilingual voice-enabled interactive chatbot launched by Finance Minister Nirmala Sitharaman. The bot can converse in Tamil, English, Hindi, and Telugu. We were the first bank to launch such a product in the Indian banking industry. Customers can converse with this bot for their general banking needs, including transactions like balance inquiry, mini statement, fund transfer over voice/text instructions, wealth management services, utility payments, etc.”
‘CUB Lakshmi’ is the bank’s banking robot. It leverages AI techniques and is integrated with the core banking solution. It provides information on accounts, answers generic banking queries, last 5 transactions, 15G submission, checkbook requests, etc.

The bank is also planning some key digital initiatives during the current financial year. One of them is an AI-based loan processing solution, which will digitally accept KYC documents, documents like IT returns, balance sheet, salary slips, GST returns, etc, and facilitate approval and sanction of the loans digitally. Says Sankaran: “The project is expected to go live by September 2021. It significantly enhances user experience by reducing TAT as application processing is done in 2 working days instead of the current 5-7 working days.”

The bank has set out on a digital transformation journey to adopt open banking and partnerships. Sankaran says it is building an enterprise-wide middleware platform that would help third party systems and fintechs to connect with the core banking / internal legacy systems. This would enable them to distribute the banks products to potential customers and build products on top of it. “We expect to go live by July 2021 and will open up banking for fintechs to partner with us,” he adds.

The bank is also implementing a low-code content document management and workflow automation platform allowing the bank to create, share and save forms and inter-office documents quickly without building them from scratch and allowing for digital execution. The project is expected to go live in 2 months by August 2021.
The platform is expected to help the bank in reducing manual processes and time delays. Also, it will help in going digital without paper. Says Sankaran: “In all the above cases, the vendors were selected basis due diligence on product capability, lower cost, company profile, feedback from peer banks, and faster time to market as the metrics.”

The bank has engaged a data analytics partner to make use of big data available with the bank on transactions, demographics, and financials of the borrowers to deliver risk-based pricing on gold loans and SME loans. This is expected to help creditworthy borrowers to get credit at a lower rate/discount compared to ordinary borrowers. It will also identify potential NPAs and reduce the risk exposure of such accounts for the bank. This project is also expected to go live in 2 months.

Usually, cheque clearing at the 3 CTS grids is done after verifying the customer’s signature and payment details. Sankaran says the bank is proposing to automate the comparison process of verifying the signatures in the cheques and those in the bank’s records. “The passing of cheques is done during the night. The staff doing the comparison at night are bound to make mistakes due to fatigue. Hence, we have started procedure for procuring a solution for system-based comparison of signature, which will speed up the clearing process,” says Sankaran.

To provide better customer service to its corporate clients, the bank is developing an API service that will facilitate integration with the ERP system of the clients so that payables can be managed more efficiently. “With this service, customers can transact with their linked accounts on their ERP platform. Customers can also manage their cash management services with this API. The project will be live soon,” says Sankaran.

City Union Bank has a number of new projects with their existing vendors. It has already implemented eKYC for opening of accounts with Aadhaar based identification of customers. It has also rolled out tab banking through which the bank’s staff meet customers at their places and using the eKYC process, open the accounts. The bank has also introduced video KYC process through which customer identification is done. Customers can open their accounts through the bank’s mobile banking application from their places. They can book a slot for video KYC and the staff will initiate a video call and verify KYC documents and signatures. Once this is done the account is opened and the customer can do all transactions. “Nearly 90% of our accounts are now opened digitally via eKYC or video KYC,” says Sankaran.

As of now, the bank’s trade finance application is a static and transaction-oriented solution. The bank proposes to implement an AI-based solution for trade finance. Sankaran says that the proposed solution will be capable of reading the documents submitted by customers online and automating the process of generating recommendations of LC/guarantee opening, bill payments, retiring of LCs, etc.

The bank has launched inter-operable card-less cash withdrawal enabling customers to withdraw cash in all its NCR ATMs by using the UPI QR code. Sankaran claims the bank is the first bank in India to launch this facility and once other banks launch this facility, customers of all banks can use this card-less withdrawal from any bank’s ATMs.

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