Way of banking will change in next 2 years; Technology to play major role

INDORE: “Just wait, way of banking will undergo major transformation in next two years and technology banking will play a major role. State Bank of India is working on several technology banking tools. Country’s biggest lender will do join unified payments interface, a kind of e-valet of group of public sector undertaking (PSU) banks.”

Said Rajneesh Kumar, one of the managing directors of country’s biggest lender State Bank of India (SBI) while interacting with this correspondent.

Kumar was in city recently to launch bank’s credit card ‘Elite’ for SMEs.  He assumed charge as managing director (national banking group) on November 2, 2015 in SBI. Prior to this, he was holding charge as managing director (compliance & risk) of State Bank of India from May 26, 2015.

Kumar was heading SBI Capital Markets Limited (the merchant banking arm of State Bank of India) as managing director and chief executive officer, prior to becoming managing director in SBI. He is also a nominee director on the board of SBI general with effect from April 26, 2016.

Kumar has been with the State bank of India for over three decades, having joined the bank as a probationary officer in 1980. MSc in Physics, apart from CAIIB, Kumar has held several key assignments across various business verticals, including two overseas assignments in Canada and UK. He has vast experience in handing large credit, project finance, foreign exchange and retail banking. He has held such important positions as deputy general manager, Pune zone, general manager (NW-II), Mumbai, regional head, SBI (UK), chief general manager, north east circle and chief general manager, project finance. Kumar is an avid traveller and has visited several countries. He loves sports and is a good player of Badminton. Here are excerpts of his interview.

  1. When will you complete the merger of five associated banks and SBI promoted Bharatiya Mahila bank into parental bank SBI?
  2. We are trying to complete the merger of five associated banks and Mahila Bank in this fiscal, i.e. by March 31, 2017. It may happen earlier than that.
  3. What do you aim to achieve by these mergers?
  4. This will give us lots of cost efficiencies. Because as far as branches are concerned, there are lots of duplication and as far as administrative offices and treasury are concerned, there are many synergies which can be improved. In any case we have 16700 branches and they (associated banks and Mahila Bank) have another 6800 branches. So branch optimisation is also expected from the mergers.
  5. Recently the income tax department came out with IDS-2016 to give one time amenity to black money holders. Is SBI planning to bring out any such scheme for NPA?
  6. We are approaching each NPA account in different manner. For small amount of NPA, we have One Time Settlement (OTS) scheme. Recently we launched OTS scheme for education loans. For small borrowers, there is non-discretionary scheme. There are standard features of such schemes and people can use OTS schemes of concerned loan head. Time to time we also organise Bank Adalat and Lok Adalat to reduce number of NPA accounts, where we offer OTS schemes. As far as bigger NPA accounts are concerned, cases differ from account to account, where we apply the appropriate tools to know whether the OTS is favourable or action under SARFAESI Act. Normal legal process is also there and whichever process seemed fit, will be applied accordingly.
  7. National Payments Corporation of India (NPCI) is planning to come out with Unified Payments Interface (UPI) app. Will SBI join in unified app of PSU banks?
  8. UPI is an e-valet. We have already such valet – SBI Buddy – and it has earned a huge popularity. Now five million customers are using Buddy. So UPI is another valet, which is optional. However, SBI will certainly participate in UPI, which is almost ready and presently in testing phase.
  9. Is SBI planning to venture in next level of technology banking?
  10. Lots of plans are underway. Lots of changes are going to happen in technology. In next two years, the way of banking will undergo total transformation, in which technology banking will play a major role.