January - March 2015

Banking with Least Human Intervention

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Technology-based banking without any visible human intervention will replace the present system of banking with human assistance, says Sushil Muhnot, Chairman and Managing Director, Bank of Maharashtra, in conversation with Kartik Sharma of Elets News Network (ENN)

Sushil Muhnot

Sushil Muhnot
Chairman and
Managing Director, Bank of Maharashtra

Please brief us about the financial inclusion initiatives undertaken by the Bank of Maharashtra.

The Pradhan Mantri Jan-Dhan Yojana (PMJDY) is a major initiative of the Government of India that has led the banks to work towards achieving comprehensive financial inclusion in a massive way. PMJDY’s emphasis is on ensuring that every family in the country joins the banking mainstream by opening accounts. All the states have done a good work in the PMJDY and the State of Maharashtra has become almost saturated in terms of opening accounts under the scheme. The Bank of Maharashtra has also achieved the assigned target successfully.

The first step was to bring everyone under the canopy of financial inclusion. After achieving that, we can extend various financial services to people. Work in this area has already been started. PMJDY can be of great benefit to the women population at large. The scheme has sociological implications as well. It leaves no room for shopkeepers under the PDS system and other government schemes to discriminate against beneficiaries, as the money comes to their bank accounts directly, thus leading to empowerment of the poor.

What, according to you, is the role of technology in financial inclusion?

Technology is a great enabler for financial inclusion. Technology can take financial inclusion to the remotest areas across the length and breadth of the country. It is cost-effective to use technology for delivering various financial services. Opening bank branches in the remotest parts of the country is an expensive proposition. So, the Business Correspondent model is the best alternative for opening bank accounts there. Mobile banking, the next big phenomenon is again based on advanced technology. It helps in bringing down the cost of operations and gives the same benefits to the customers as in the bricks and mortar model. It is also creating a robust payment infrastructure that is equally important for successful implementation of PMJDY.

How do you perceive the role of Aadhaar to give a boost to financial inclusion programme in the country?

Aadhaar will play a critical role in financial inclusion. It will form the basis of all transactions. Further, all the bank accounts must be seeded with Aadhaar to prevent bogus accounts. Aadhaar will also help in preventing all duplications.

Technology is a great enabler for financial inclusion. Technology can take financial inclusion to the remotest areas across the length and breadth of the country

How do you visualize the future of the banking industry in the coming times?

The banking industry will undergo drastic changes in the next five years. If we visit a bank branch, we see transactions happening and the staff of the bank managing the transactions. In the coming five years, these transactions will be taking place outside the bank branches. Technology will be deeply ingrained in the banking system. There will be total elimination of human interface. Banking will transform from a transaction banking orientation to a sales and service orientation.

The Bank of Maharashtra is preparing itself for this transition which will come sooner than later. Sometime back, we introduced the concept of ‘click to bank’ for our customers. The essence of this initiative is to create an infrastructure where people can do transactions without human help. It is a setup with an ATM, a cash deposit machine and a cheque deposit machine. At some places, we are also introducing kiosks. In order to reach out to the rural population, we are employing the Business Correspondent (BC) model.

Recently, Prime Minister Narendra Modi expressed his vision for cashless banking. What is your view?

It is possible for us to migrate to a cashless form of banking with every citizen having a bank account, RuPay card and with the help of mobile banking. This will help the process to be seamless as well as faster

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