CIO

Biometric-Enabled Mobile Banking Is The Future

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At a time when the State Bank of India plans to invest heavily into technology to beat competition from the private sector banks, N Jambunathan, Deputy Managing Director and Chief Information Officer, SBI, in conversation with Kartik Sharma of Elets News Network (ENN) talks about the past achievements, present-day needs and future course of the largest public sector bank

N Jambunathan

N Jambunathan
Deputy Managing Director and Chief
Information Officer, SBI

Starting off as a Probationary Officer in 1978, you have had a long inning with SBI. How do you see the future of banking Industry in India?

When we started banking 35 years back, it was entirely manual. But in the last 10 years, since 2002-03, banks have invested heavily in technology and channel partners. Also, banks have created infrastructure in the form of channel partners, ATMs, internet banking, mobile banking, etc. In future, bank transactions will rise exponentially. In the recent past, because of government subsidies, additional 8-9 lakh transactions have been added to the SBI data. When all government payments will be made electronically and more people are added to the workforce, number of volumes of accounts and transactions will shoot up. The banks need to gear up for this volume of work.

Don’t you think that the available infrastructure with the banks to accomplish this task is grossly inadequate?

No, SBI has enough scalable infrastructure model to handle this pressure. At present, we have 55,000 ATMs and can manage 80,000 ATMs easily. With regard to our core banking, it is a modular structure. We are benchmarked for handling 1 billion accounts.

You have branches in the rural and remotest areas in the country. What type of challenges do you face in handling these accounts?

The main challenge in rural India is lack of communication infrastructure. Even in SBI, around 3,000 branches are connected through VSAT. VSAT is slow, as it has very limited bandwidth. So, we need to take our digitisation further and get lease line connectivity. As the upgradation of these twothree thousand branches will happen simultaneously, newer branches will remain crippled due to poor infrastructure. This is one big issue that requires to be addressed. In rural India and other far-flung areas, distance is a concern…it renders rural branches unapproachable.

Is hardware maintenance an issue?

Yes, hardware maintenance is an issue in rural areas. In case of breakdown of an ATM, it cannot be repaired for two-three hours. First, a technician has to visit the location and find the fault there and then will report back to solve the problem. This way, it takes too much downtime in rural areas in getting a banking device repaired.

Can you throw some light on the recent IT tool deployments that have brought about significant changes?

SBI recently started InTouch branches at 67 locations. These branches are completely digitised and ensure that all the tasks of bank account opening, personalised internet banking, personalised debit card, etc., are accomplished in 10-15 minutes. We also provide opportunities to customers to check that the financial tools for loans and other service are available to them. There are also remote web centres, where SMEs (subject matter experts) on products as personal loan and home loan can be consulted. In general banking branches, we can’t offer experts for all the banking products. However, at inTouch branches, video chat option is available. Recently, at some branches, passbook printers were installed for the customers, so that they do not have to depend on any bank assistant for the passbook printing.

You just now talked of kiosk banking. Is it a success at SBI?

Originally, we started with small mobile-like devices. But later, the prices of PCs came down and communication improved with 2G. It was initially thought that full-fledged PC-based systems can help in financial inclusion. So, we started with the kiosks with limited facilities. But now there are Internet-based kiosks in branches, where you can do a lot of transactions. You can carry out 15 to 16 personal banking transactions, easily. Internet-based mobile devices also work as micro kiosks that can serve four-five villages in the coming times. Mobile devices with biometric facility are the future of banking.

Is biometric facility already available in the kiosks?

Yes, biometric is already there in the kiosks. However, tablets needed to be integrated with biometric facility. As tablets are handheld devices easy to carry, those are the best suited devices for the banking needs of the future.

There are lots of accounts, transactions and data. Is the technology like Big Data relevant for handling those data in the future?

Big Data will be used internally for decision making and externally for doing business. SBI is doing a Big Data project for data warehousing with a huge investment. The bank has invested in the server hardware on trial basis for data analysis. The bank is also participating actively on the social media platforms like Facebook, Youtube and Twitter. Lots of information is there, which will be analysed for future use.

With so much happening online in the banking sector, do you think, there is a security issue?

Most of the online activities are password-based, which in turn are mobile phone-dependent. As long as you don’t lose your mobile phone, your transaction is secure. With respect to fund transfers, there are strict norms and procedures, so it is not easy to breach security.

With the advent of new technologies, the regulatory environment in banking is also changing. Do you see any change in the role of CIOs in the new environment?

The role of CIOs has changed several times. They should lead the business in IT activities. The relation between information technology and business should be of cooperation. The IT should be enabler and knowledge partner for the business. IT analyses the data and we will use it for the growth of banking business. In present circumstances, a CIO must know his role and duties, otherwise, he will remain only an IT solution provider.

The Government of India has launched a Financial Inclusion programme, called PMJDY. How do you envisage the role of SBI in promoting PMJDY?

SBI has opened more than two crore accounts under the Pradhan Mantri Jan-Dhan Yojana. It is a good scheme that targets subsidies and assures banks of better deposits. In the entire banking sector, around 30 lakh bank subsidies are taking place currently. Other subsidies, when transferred to banks, will play an important role in enriching bank coffers. PMJDY is a good scheme and will generate good number of deposits and transactions for the banks.

What role do you see for the private sector towards expansion of financial inclusion in the country?

They have opened very limited number of accounts…only 25 lakh accounts. There should be provision for penal action— like slapping of extra taxes—against the institutions, which do not help in promoting financial inclusion. There should be a level playing field.

SBI has opened more than two crore accounts under the Pradhan Mantri Jan-Dhan Yojana. It is a good scheme that targets subsidies and assures banks of better deposits

When do you think India will see complete and comprehensive financial inclusion?

Most of the people will have back accounts by the end of January. But, when the people will become financially literate and be able to invest appropriately in different financial products like insurance, loans, etc., they will be financially included in the true sense. Nonetheless, it will take two to three years to make people financially aware and make the society financially inclusive.

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