IBM InterConnect 2013 Mobile Keynote: ING

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  • 1. Driving Inclusive Growth through Mobility Aniruddha Paul CIO, ING Vysya Bank
  • 2. The Importance of Being Ranjana Sonawane Who: UIDAI Unique Identification Authority of India What: (1) Assign a UID to all 1.2 billion Indians; (2) Provide online biometric based authentication services Numbers: (1) Database > 6 peta bytes (6000 terabytes) (2) > 1 billion addresses (3) > 1 million auth requests/day (4) 500 million UIDAI numbers already issued
  • 3. There is a Fortune at the Bottom of the Pyramid – Unlocking the Fortune Requires Mobility Need for unique ID To provide accessible identification that can be used for entitlement (unique and universal) Master Data Management Enable service and applications that require a verifiable unique ID (continuity and mobility) Data Mining Real Time Analytics Business Intelligence Prevent duplication of effort and leakages existent in the current system Data De-duplication Data Quality IBM Worklight & ING Vysya Bank can leverage the UIDAI platform towards Financial Inclusion and Social Change through appropriate banking apps and services
  • 4. Retail Banking: What’s been good for Indian banks hasn’t been good enough for the country • Scorching pace of growth since liberalization: CAGR of around 30% to touch a figure of INR 9700 Billion. Bankable households are growing at a CAGR of 28% (2007-11) • But the growth has been lopsided • Retail loans constitute 7% of our economy versus 35% in other Asian countries • Retail assets are at only 25% of total banking assets • 41% of India’s adult population is un-banked • Number of loan accounts: 14% of adult population • 73% of farm households have no access to institutional credit • Share of money lenders in rural debt has moved from 17% in 1991 to 30% in 2002
  • 5. This imbalance is caused by banks chasing the low hanging fruit that constitutes the urban savvy consumer • Purely from a profitability perspective, a large portion of the Indian population is perceived to be “unbankable” • The costs of servicing the remote rural sector using traditional business models (KYC; branch centric model; incremental cost of infrastructure) makes profitable banking unviable • Therefore, all banks tend to target the upwardly mobile urban salaried class • Banks are even creating “financial exclusion” barriers by increasing minimum balance requirements and average deposit sizes • Technology has lowered the cost of servicing this target segment
  • 6. Fortunately, The Scenario is Changing • Financial Inclusion (FI) is an RBI mandate, government mandate and a social mandate • There IS a fortune at the base of the pyramid • Social security payments and NREGA payments (> USD 100 billion) are being routed through banks • MFI’s have shown that it’s possible to run extremely profitable businesses. Most major banks are working on a business-driven FI strategy • Simplified KYC norms (e-KYC) and UID is expected to drive down the cost and time of customer acquisition and servicing • Innovation in mobile / hand held devices using an uniquely Indian model offers the best potential breakout strategy. IBM Worklight with its flexible, open architecture and easy integration will be a key enabler of our initiatives
  • 7. “Today, if you look at financial systems around the globe, more than half the population of the world – out of six billion people, more than three billion – do not qualify to take out a loan from a bank. This is a shame… The poor themselves can create a poverty-free world... all we have to do is to free them from the chains that we have put around them” - Muhammad Yunus
  • 8. Thank You