Issuance of Payment Bank Licenses will Transform Indian Banking – H R Khan of RBI

Speaking as the Chief Guest at the 9^th edition of CII’s Banking Tech Summit, H R Khan, Deputy Governor, Reserve Bank of India acknowledged the apt timing of the summit post the recent ‘Gyan Sangam’ held in Pune which also discussed about using and liberalizing technology in banking. While speaking about RBI’s role in technology adoption Mr Khan mentioned about e-kuber – a core banking platform adopted by RBI which allow banks to operate through a single account with RBI. He also shared that connecting mobile with aadhar under the Jan Dhan Yojana will be the solution going forward for financial inclusion, as it will facilitate serving the 120 million cards.

Mr Khan also added that RBI is focusing on bill payment systems which is the next big thing for which Bharat Bill Payment System and National Payments Corporation of India (NPCI) are on board and other bill aggregators are expected to join soon. Speaking about the trade receivables by MSME sector which doesn’t receive bank financing, he mentioned about a platform being under way for discounting these receivables. He also asserted that issuance of Payment Bank Licenses, which will bring the telcos and banks together, will be a game changer in the field of remittances and bill payments. Speaking about the compliances for the banking sector he appreciated the CII-PWC report for capturing this aspect with diligence.

A P Hota, Managing Director & Chief Executive Officer, National Payments Corporation of Indiaaddressing the gathering of bankers and technology experts at the CII’s Banking Tech Summit mentioned that universalisation of access can be provided through digitization. In today’s banking system 70-80% of transactions are digitized at the public, private and foreign banks. He added that NABARD in its efforts is leading the process of digitization of 85 Regional Rural Banks. He also mentioned about the measures to digitize 31 State and 360+ District cooperative banks, scheduled and non-scheduled banks along with post office banks is underway. Mr Hota, stated that the project for 100% digitization of all payment modes might not happen through internet banking alone and processes are considered for implementing mobiles. He concluded saying universalisation of access to banks at all levels is important and that the central infrastructure is playing a role of bringing all the partners together.

M S Raghavan, Chairman & Managing Director, IDBI Bank Ltd mentioned that digitization of end-to-end processes for engaging customers through digital channels and pre-empting there expectations through customers analytics is crucial. He shared that moving towards electronic transaction avenues has helped banks in significantly boosting there business growth. Technology has also enabled banks to increase efficiency and efficacy of the processes. Core of the digital initiative lies in the inherent ability of banks to deliver customer friendly offerings efficiently which goes beyond technology, added Mr Raghavan. He concluded by saying that the Indian Banking Industry is at the rhetorical inflection point and digital revolution driving it will shape future trajectory efficiently.

Arun Jain, Chairman – CII BANKing TECH Summit 2015 and Chairman & Managing Director, Intellect Design Arena Ltd. and Chairman, Polaris Consulting Services Ltd while delivering his address shared the quick transition of the banking industry services from desktops to mobiles. He mentioned that money transfer through payment systems by making money digital has created enormous avenues. He stated that digital medium can provide quantifiable financial benefit to the customers. It can help converting the customers to primary account holders from account holders. He further added that the challenges will remain in providing friction less payment process and have concrete and actionable benefits for the users.

In his welcome remarks Sudhir Mehta, Deputy Chairman, CII Western Region and Chairman & Managing Director, Pinnacle Industries Ltd mentioned that today demand and expectations of customers is changing rapidly with time. He added that the summit will focus on taking banks through digital transformation and gear up to be further in the game.

Arnab Basu, Technology Leader, PwC, India while highlighting the insights of CII-PWC reports post the release mentioned that digital natives are primary base of banks and there is a need of enormous tailor made solutions for users today. He also mentioned that there is a huge need to understand not only the volume of the data for analytics but also the velocity of the data which is crucial. The report suggests that customer acquisition and on-boarding is the key area, added Mr Basu.