1. What does the future of banking look like and how are you aligning your tech goals looking at the fast-changing market dynamics?
In today’s world, technology adoption is imperative for the sustenance of any business strategy execution. For example, what used to be traditional, branch-based banking, or DSA-based banking, has now evolved to become do-it-yourself, digital journeys with an eye for providing frictionless onboarding and customer service journeys that deliver instant fulfillment of service expectations.
Banks are looking at multiple opportunities to engage with partners. By partners, I refer to entities/fintechs in the B2C segment who specialize in verticalization of services to solve important problem statements. Such partnerships enable banks to expand their acquisition/distribution footprint, enhance opportunities to provide customers with a wide array of services (beyond banking) and connect the dots for financial and non-financial needs across the life/business spectrum.
Towards this endeavor, we are re-looking at our digital journeys, especially those that deliver customer experiences with the customer being at the center of the engagement. So, from the customer experience perspective, the focus is to enhance our digital capabilities and to deliver on all these expectations about knowing your data and creating intelligence out of it.While we have the knowledge of our data, we are on the path of creating the intelligence using tools such as AI and make it work and useful for both internal purposes as well as external customers.
Apart from this, we have made continued efforts to upgrade our API-enabled ecosystem. Today, banks have started evolving from being traditional, brick-and-mortar to enabling digital engagement through API enabled integrations with companies, B2C partners, and corporates. We have been leaders in the API space and will continue to overdrive, however, its now imperative we package and productize our offerings to meet business imperatives. Our focus will be on packaging the API / Microservices as products that meet/solve business challenges/gaps and expand our interactions to drive growth.
Technology-enabled risk management is an area of focus too. The acceleration of digitization is elevating risks and the traditional risk engines have gaps to tackle emerging scenarios. Hence, the bank has continued investing across upgrading skills of people, evolving the process and revamp technology solutions.
Another key transformation is around people and talent. The focus is on enhancing the knowledge and using the pillars of basics of banking to make it more interactive while cross-skilling and up-skilling the talent.
2. What should be a bank’s digital transformation story be like?
Bank should chart its own journey of transformation basis an understanding of the market evolution, business strategy, evolving business models, ability to effectively change and ability to actively manage risks in a fast-changing environment.
As an example, a bank despite being a leader in the payments ecosystem is looking to expand its retail franchise. For this, it is investing in enhancing its digital capabilities that create enriched experiences supported by intelligent product positioning through appropriate mining of data that is generated. This approach is expected to fuel balanced growth to deliver increased levels of profitability. The bank will need to actively engage in meaningful partnerships across sectors that seek to expand its sourcing and distribution capabilities.
It’s important that the bank defines its purpose through these journeys and drives its trajectory of strategy execution towards meeting its purpose. In my opinion, technology will be the enabler that propels the bank to fulfill its strategy execution. It is critical for banks to measure the value being generated from the multifold investments made in its growth journey.
3. Do you believe that for banks to remain resilient and maintain operational efficiency, they should strategically look at data centres so that they continue innovating without facing any downtime?
Any financial institution, like a bank, has to provide the highest level of service to its customers. The data centre is a very niche service, and managing it is quite a task for entities like banks. Today, as compute demand increases multifold, you need to partner for such specialised services and derive the optimal benefits being offered. Banks will rely on data centres to host their critical assets. Co-location with the right levels of security, control, and environment that is being made available.
Large institutions may build their own data centres with the help of data centre service providers. Besides, a lot of data center service providers are moving to the private cloud journeys. And this is where it becomes a logical extension for banks to work with these service providers as an alternate to cloud service providers. Moreover, data centre service providers are also offering a lot of value-added services in terms of observability, data storage, and logs. Banks don’t need to invest in these areas if their infrastructure is managed by a specialised service provider.
4. Any particular reason/s that YES Bank decided to co-locate to a Tier IV data centre?
To meet our key expectations around sustainability, availability, and security, we have evaluated our target operating model, and one of our key foundations, is to engage with strong data center players to host our most critical assets. Towards fulfillment of these objectives, we have moved to state-of-the-art data centers with appropriate redundancies.
5. Banking services have undergone a sea change in the recent times – all thanks to the underpinning technologies. Any particular technology or technologies that you are betting big on
Using the layer of artificial intelligence on top of the data and the journeys – this is one area that I don’t think we’ve really worked on but I am very keen to understand.
Digital currencies just got launched and how do you make these digital currencies the way forward. You won’t be surprised to hear that in the next 5-7 years, there’s no physical currency in the offing. Everything is digital. The build out to this approach will be important, with blockchain, AI, and data underpinning it.
6. There are a lot of things happening on the risk side for an organisation like a bank. As everything gets digitised, how does risk look at it differently? Risk means information security, operational risks, and market risks – all of that put together. How do you adapt to this change?
You have to look at how you secure yourself in these areas and at the same time, think differently. I think this is another area that I’m very keen on devoting a lot more time to because you can do a front-end escape, but if the back end is weak, you will end up having its own set of problems.