IT plays prominent role in banking

IRIS

Top officials in the banking sector feel that technology is the engine, which
is driving the banking industry towards the path of growth.

According to Ms Madhabi Puri Buch, head corporate operations and technology,
the technology at ICICI has helped it to expose customers to world class
services. As a result, today, they are able to provide instant information,
instant access and instant services to customers.

IT has also helped the financial institution to expand ATMs across the
country. At present it has 1000 ATMs and the number is expected to increase.
Further ICICI has succeeded in providing comprehensive services to its customers
by expanding call centers. The institution was the first to launch digitally
signed contract notes.

Buch believes that application of latest technology ensures benefits to the
customers at a very low cost. It also holds the ability to scale up and handle
volatile volumes. She further added that so far ICICI has been successful in
passing on the economies of scale to customers and in providing online real
information. Buch further believes that it is the technology, which will allow
the industry to expand even in rural areas.

According to CN Ram, head, information technology, HDFC Bank, the banking
sector should be ready to spend money on technology in order to receive the
benefits out of it. However, he added that its not just sufficient to implement
technology, it is also necessary to ensure that its advantages are flowing
continuously. To implement technology it is important to get the architecture
right. The banking sector needs the ability to capture the developments in
technology and translate that.

PS Shenoy, chairman and managing director, Bank of Baroda is of the opinion
that, public sector banks are lacking value only due to lack in technology. He
believes that to become a world class bank it is necessary to implement high end
technology. It is necessary for the corporates to have a business plan otherwise
simple implementation of information technology will not yield the desired
results and it will be a total waste of resources. According to him if
technology is not implemented properly, then it will be a mere duplication of
manual efforts.

State Bank of India managing director and group executive (corporate
banking), Y Radhakrishnan, also stressed on the scope technology holds for the
banking sector. According to him, technology is the engine and quality of the
engine is the most important thing. He further added that the bankers have to
make investment on technology very seriously as everything has to be customer
oriented. The bank currently has a 90 million customer base with 25 million
transaction taking place every day. This has been possible through latest
technology. According to him it is of utmost importance to have the latest
technology and also it is important to get the staff involved for that.

Through technology, the cost of transactions can be reduced dramatically, as
a result the banking sector should focus on application of technology to expand
in the future. He further added that technology upgradation involves resistance
to change at all levels. He feels that it is important to communicate with
technology and State Bank of India is very committed to this role. He further
stated that by the end of 2002 the bank will have 1500 branches in 52 centers
and by June 2004, 80 per cent of the bank`s operations will be online.

Girija Pande, regional director, Asia-Pacific, TCS is of the view in order to
develop the banking sector through technology, banks have to move to the next
phase to increase returns. It all depends on how well the banks manage their
projects through technology. Whenever they plan moving into the net, major
changes in information technology should be taken into account. According to him
digitizing and straight-through processing should go in turn to make progress
with technology. Technology spread has to be justified and it is also necessary
to justify focus of the expenditure on technology.