kiran_kumarKiran Kumar, Industry Director, Financial Services, Oracle India talks about company’s efforts to provide end-to-end service to financial outfits. In a tête-à-tête with Poulami Chakraborty of Elets News Network (ENN), Kumar elaborates how Oracle is bringing value addition to the payments eco-system

What’s the product line offered by Oracle for the banking and financial sector?
It is needless to say that the financial industry is the one of the most important verticals for Oracle, globally. Given the fact that telecom and financial services are one of the robust industries; Oracle across the world strives to provide end-to-end service to financial outfits, catering them with all that they may require for end-to-end operation, seamlessly. That would comprise out of the box application, partner applications in both software and hardware, without specific reference to technologies involved in Cloud that finds reference in financial services. Thus, from a functional block perspective to a relationship experience that customers take back a whole gamut of functions is supported as out of the box functions. Here, we are left with two choices, either run on the same trail that the banks have done in the past or transform the day to day functioning to Cloud technologies as provided by Oracle. When it comes to-end-to end coverage of financial sector, we cover the financial layers from a financial perspective to deployment mode with a varied choice between- public Cloud, private Cloud and direct Cloud option.

Payment system is being emphasised as the key theme for banking industry. How Oracle plans to contribute it?
Digital payment is only one part of the overall financial services value chain. However, due to the under-penetration of the payments system in the country, it is getting due importance and visibility required at the moment. At the end of the day, payment is about transferring money from one point to the other with the help of technology and requires as much precision, as is required in the on-premise world. From a technology stand point, the core transaction processing infrastructure is something that Oracle delivers. The hardware requires the processor payment transaction, be it through domestic payment system, or international payment system or PtoP payment system- they are all supported by Oracle Core Technology Infrastructure.

More interestingly, what we are doing presently is bringing value addition to the payments eco-system by enhancing capability such as pricing of a transaction, billing of a transaction and the whole processing of the transaction which can be done through Cloud infrastructure. As a matter of fact, even though the payment trail is happening, there is not much innovation happening in the space. Where the benefit can be reaped is a layer above it, depending on the value-addition the financial institution renders to its customers. The convenience and frictions generated by a particular institution in processing of services matters the most. From an Oracle stand point, we continue to provide technological support to make payment trails robust so that you can handle the volumes that are required, while rendering the innovations that are required for consumer choice to be exercised. For consumer choice it could be staffs like digital experience, mobility technologies, that can help create helps to ensure consumer stickiness on one system over the other.

While a lot of revolution is happening in the banking sector on a regular basis, how do you perceive adaptability to these changes in the Indian consumer ecosystem?
Banking being a regulated industry, we are unlikely to see the jazz and glamour that exist in the e-commerce industry. In a regulated industry, the choice of industry first looks at the factor how it fits into any regulated standards. In a recent study it is highlighted that technology adoption in banking and financial sector has witnessed a market shift with a growth rate of 40 per cent per annum.

In a McKinsey study, it is stated that the number of bankable millennial will exceed 30 million, which is quite a large number and this population is unlikely to visit the banks. Though, there is no concrete data to support this fact, however we would soon witness a capitalisation shift from brick-and-mortar branch set up to digital banking set up, which is again an indicator of the fact that banks will see a shift in the way they communicate and transact with financial institutions and customers.

How is Oracle’s Cloud strategy in the financial services sector doing?
The Oracle Cloud strategy is all about choice. We acknowledge the fact that Cloud computing is a style of computing and there is no “one size fits all” approach and we render this through three different models. We provide high-end technologies that let banks build their own ‘private Cloud’ that means these technologies reside within the bank’s data centers. We also manage these technologies on behalf of banks which we call the managed Cloud offering. For example, a bank that runs its core banking system within its data center but is managed entirely by Oracle is known as a managed Cloud service. Another model is ‘software as a service’, where there is no technology footprint in the bank’s data centre, and almost all of it is consumed from the Oracle data centers. Banks have a choice of either of these approaches for their front office, mid office or back office technologies.

Oracle is already observing traction in the BFSI vertical with companies like HDFC Bank deploying Oracle Cloud solutions in a hybrid model. The Cloud implementation has enabled an agile, self-service and efficient infrastructure with reduced complexity and allows IT to deliver services more closely aligned with business requirements.

What are the main reasons for adoption of Cloud solutions in this sector?
The factors driving growth for implementation of Cloud solutions in the banking sector are –1. Impetus on digitisation of banks, 2. Granting of banking licenses requiring rapid setting up of banks, 3. Pradhan Mantri Jan Dhan Yojana and 4. Financial inclusion forming a critical part of the Indian government’s charter and changing needs of the empowered consumer.

A survey among senior bank executives shows 90 per cent of them are in favor of including SaaS or Cloud based services as part of the infrastructure. More than 60 per cent banks worldwide are processing a majority of transactions on the Cloud. This is driven by the need for banks to deliver a better return on equity. But efficiency alone will not be the driving factor for banks to adopt Cloud. There are other factors such as the emergence of digitally savvy customers, product innovation, and faster go-to-market that will drive the adoption of Cloud technology.

Over 60% banks globally are processing a majority of transactions on the Cloud. This is driven by the need for the banks to deliver a better return on equity

Oracle firmly believes that business innovations fuelled by changing customer behaviors will be the single most reason for banks to adopt Cloud. The emergence of the concept of bimodal IT will further accelerates adoption of Cloud. Simply put, IT departments within banks will have two modes of operations- ‘lights-on’ mode and the ‘innovation’ mode. The innovation mode is more like a sprinter. IT needs to run fast, to ensure that the bank catches up with the customer behavioral changes taking place and introduce innovative technology that can address that change. So essentially, we will require the traditional set of technologies that banks have been adopting, as well as innovation which will be rendered purely as a Cloud technology.


  • Impetus on digitisation of banks
  • Granting of banking licenses requiring rapid setting up of banks
  • Pradhan Mantri Jan Dhan Yojana
  • Financial inclusion forming a critical part of Government’s charter and changing needs of empowered consumer

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