Implementing theory of reverse innovation

‘Reverse Innovation’ is when products are built in India for the Indian market, and yet, can be scaled on a global level. Lots of the global products that are designed outside India simply do not fit the cultural and complex variations of this country. We, therefore, decided to build products for the Indian banking sector, says Dr. Jaya Vaidhyanathan, President, Bahwan CyberTek & CEO BCT Digital, in conversation with Elets News Network (ENN).

Dr. Jaya Vaidhyanathan

You have been in the financial industry for over 20+ years and you have recently said that your dream is to see India as a superpower. What do you think are the top 3 areas of opportunity?

India is the hub of talent. If implemented at the right place it can contribute to taking our country to the global level. I see three opportunity areas that can help our country fast track on its growth target:

1. One is to provide challenging opportunities and ease of doing business for Indian talent so that they can contribute to our growth. We have to take the “Make-in-India” to the next level.

2. Our growth needs to be more inclusive, for instance, the financial services industry – Banks, Non-banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs) hold the key to extend credit to deserving sectors, encouraging entrepreneurship and continuous monitoring of asset quality.

3. Ethical and sustainable growth is important for which we need to enhance our focus on Global Corporate Governance frameworks.

What are the Fintech solutions provided by Bahwan Cybertek?

We are pioneers in the risk management space with our flagship product “rt360” – a 360-degree regulatory management and risk transformation suite. rt360 is a risk management suite that enables banks and financial institutions to transform and optimise their digital risk and regulatory compliance management and empowers them to focus on credit growth and profitability. The suite includes credit risk, liquidity risk, model risk, and operational risk.

The product leverages the latest in digital technologies such as Artificial Intelligence, Blockchain, Machine Learning, and others to provide unbiased and intelligent risk decisions.

What steps are you taking to help banks reduce and track NPAs?

Having implemented the Early Warning System (EWS) in several banks in the last few years, we are in a better position as technology service providers to unearth much more data on borrowers from big data sources in addition to traditional data sources and this has aided with insightful decision-making.

The insights thus gained can aid with intelligent outcomes for the banks. In addition to analysing borrower profiles as mandated, with new-age technologies, including Artificial Intelligence and Blockchain , we have the opportunity now to leapfrog from just analysing the transactional data of borrowers’ accounts to looking at them strategically; the availability of data can make this a reality.

For example: looking to see whether the promoters are in the news for the wrong reasons; have the promoter’s dumped shares and so on. We are expanding the scope to track NPA’s through four critical areas: Massive data ingestion and analysis of loan portfolios of banks across the country, products, and industries/ customer segments, to take management calls on pulling back or expanding credit to specific sets of customers.

Detect the stress of borrowers from what is reported in semi-public sources, including legal cases, share pledging, dubious business dealings, and so on. Listen to rating agencies on what they are saying about their borrowers, industries or the economy Listen to online and social media chatter on the promoters of a borrower.

Please tell us about your new mantra the “Reverse Innovation”.

“Reverse Innovation” is when products are built-in India for the Indian Market, and yet, can be scaled on a global level. Lots of the global products that are designed outside India simply do not fit the cultural and complex variations of this country and are, therefore, not a straight-fit for us especially in core areas like Non-performing Assets (NPAs), financial inclusion, payments, etc. The Indian banking sector is complex, and we need products that are engineered for the Indian market taking into account the unique nuances that are part of India. We, therefore, decided to build products for the Indian banking sector focusing on our unique challenges in the credit and operational risk spaces. We made the products in India and they are now in high demand in global markets.

What are the new innovations you are planning to implement in the company for the next 5 years?

Quantum computing, Artificial intelligence, high-end analytics are some technologies that will revolutionise the way we work over the next 5 years. There is going to be a surfeit of data, making decision making more complex. For example – AI will not just replace low value-added work but aid in unbiased decision making when there are thousands of data points that could aid in key credit decisions. Our innovations will continue to be built out of India and will leverage the best of breed global technologies to address unique business problems.

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