In an interview to the Mckinsey Quarterly in March 2007, K.V. Kamath, then the CEO of ICICI Bank, stated that in addition to being the CEO, he played the role of a CIO (Chief Information Officer). There was no chief information officer or head of technology in ICICI Bank then. The heads of the various business units were responsible for implementing technology solutions to grow their own SBUs. Technology was that important for growth.
But, the story is different today. Almost every bank, be it mid or large sized, is automated at least in their core banking operations. Over the last two decades (1990 to 2010), technology was at the forefront of the banking revolution. There was mammoth growth in number of deposits, amount of lending, number of customers, product lines and market expansion. Banks ran with the help of technology (everything from core banking operations, customer relationship management, wealth management, managing treasury requirements were made more efficient using technology solutions) and drove everything from efficiency to business process. ICICI was not alone in this revolution.
Around the same time, there was a parallel story happening at one of India’s largest IT services firms, Infosys. Finacle, a product for the banking sector, was being developed. In the early 90s, Infosys did have its product ambitions. “The belief was, products brought non-linearity to growth. Banking was a fairly regulated, standardised industry and there was market demand. It was the right sector to target with an information technology product,” says M. Haragopal, global head, Finacle, Infosys Technologies. In the early days, the Finacle group went after sales in India. Once they realised that almost two-thirds of the banks in India used the Finacle product, they decided to tap into global markets.
Today, Finacle serves over 135 banks in 65 countries, and its product features have been expanded to support everything including mobile banking, financial inclusion and Islamic banking.
Over the years, Finacle has continuously added to its road map by objectively trying to answer one question: What next for a bank?
During early 2000, branch automation was the most important aspect. They built the product with a service-oriented-architecture (SOA), which basically meant the process of customising a particular parameter for a bank was easy. While banks and their branches were getting seamlessly automated, the focus shifted to include customer relationship tools, Internet banking and wealth management solutions.
Going forward, banks are trying to bring in over a 100 million new customers into the fray. Finacle is working on building features and products to ensure this large-scale client acquisition process will happen smoothly by offering solutions that include “mobile bank in a box” and “inclusion solutions”. Haragopal explains, “Banks are looking to establish newer processes to target this next wave of growth. Whether its product or process innovation, it is going to be IT-enabled and that is where Finacle fits in.”
For the population that is already banked, the focus of banks is on delivering customer satisfaction. Finacle, through its “Customer Experience” solution, along with mobile and Internet banking tools, aims to help banks interact with customers in an efficient and intelligent fashion.
Finacle’s “watch wiz” solution aims to give banks access to a monitoring tool to keep track of several parameters within the Finacle umbrella. With limited intervention from Infosys, it helps the client bank ensure the complete Finacle solution is running fine, without any glitches.
The role of professional services
Once the product is rolled out to clients, there is a customisation layer to tweak the parameters relevant to that particular client. From adding and removing features, to connecting the solution with data already available at the bank, the final stage of product installation and training employees to use the product properly is very important.
Haragopal believes that “delivery excellence” is crucial for the success of any product, and the professional services and consulting teams ensure the product works well for its client.
Haragopal, after spending 18 years with Finacle at Infosys, is still answering the same question he started tackling in the early 90s. What next for banks? – It could be mobile bank kiosks at Indian villages; core-banking solutions for clients in the Middle East and Africa or even a Web 2.0 enabled banking application for a smart phone.
Going by Finacle’s strategy in the past, they’ll probably have all these solutions ready just when the market is ready to implement them.