Mod1 - MBO-14-Banking - Services and Innovation

MANAGEMENT OF
BANKING OPERATIONS
CHAPTER 14 – BANKING SYSTEM

– SERVICES AND INNOVATION
Global Developments in Banking
Artificial Collaboration
Intelligence and with Fin-
Automation tech
companies
Technologies that will change the face of
Banking
Chatbots
Machine Learning (Big Data Analysis)
Blockchain
Automated personalization
Robotics
Peer to Peer Lending
Role of Fin-tech Companies
● Gone are the days when banks viewed Fintech

companies as disruptors; today, they are partners
that are pairing up to take on the challenges of the
digital world
Yes Bank and Fintech Collaborations
As of now, YES BANK has partnered with over 100+ Fintech

startups across different verticals including payments,
regulatory technology, and wealth management, among
others.
The participating startups will get access to YES BANK’s

powerful network of over 2 million retail, 10,000+ SME and
5000+ corporate customers.
Along with this, they will also receive funding up to $1

million through VC partners, without experiencing any
upfront equity commitment.
Yes Fintech – Key focus Areas
Lending
• Smart Credit Solutions Digital Loan Solutions
Digital Payments
• Instant Cross-border Remittance Peer-to-Peer Payments
Real-time Data Analytics

• Itemized Reporting
Cyber security
• Fraud Risk Management
Process Automation
• Instruction Processing with Encryption
Wealthtech and Investech

• Robo Advisory Platform Front-office Automation
What do you think are
the problem areas with
Fintech becoming an
integral part of
banking system?
Case Studies of Banks
Private Sector • ICICI

Bank:
Public Sector • SBI
Bank:
Foreign Bank: • HSBC

ICICI Bank
• Established in the year 1994
• ICICI Group comprises of ICICI Bank and various

subsidiaries in the area of Life Insurance, General Insurance,
Asset Management, Investment Banking and Venture
Capital
• Has a strong presence nationally and Internationally

Achievements of ICICI BANK
First Bank in India to launch a Website

– 1996
First Bank in India to launch Internet

Banking – 1997
First Bank in India to launch online bill

payment - 1999
Financial and Digital Innovations@ICICI
ICICI Bank’s e-wallet - called 'Pockets'.
For the first time, ICICI launched a product (in February 2015) that
was not restricted to the bank's customers.
Anybody could download and use it, just like you would use a
Paytm wallet.
The wallet comes with a physical card as well - sort of a debit card -
that allows one to use the money in the wallet in offline
transactions, such as at a merchant point of sale.
Another aspect of Pockets is that it is linked to social banking -

users can send or request money from any e-mail id, mobile
number and friends on Facebook, among others.
ICICI's mobile innovation is its app 'iMobile'.
Unlike Pockets, this one is for existing customers

of the bank and enables 125 banking services.
The app is also integrated with Google Now that

gives out payment due alerts.
First private sector bank in 2013 to introduce 'Branch on

Wheels' that provides basic banking facilities to unbanked
villages.
The idea was to take a sophisticated van - one that is

connected to the internet with laptops, authentication
machines, etc - to smaller villages where there are no
branches.
It offers services such as savings accounts, deposits and even

loans
Expressions Paywave NFC (near-field

communication) Card
Biometric Authentication for

ATM: Empowering rural
customers
Tab Banking: Officer visits location of

your convenience
Innovations @SBI
Partnered with Flipkart to offer its consumers the facility

of pre-approved EMI Facility on purchases. Under this
partnership SBI will provide overdraft facility to pre-
qualified set of customers for transacting on Flipkart for a
minimum purchase of Rs. 5000
The EMI facility is available in 3 tenures – 6, 9 and 12

months.
The bank does not charge any fees to process the

facility.
Innovations @SBI
‘SBI Mingle’ – its social media banking platform for Facebook and
Twitter users.
Using SBI Mingle, its customers can do a host of banking services

like checking balance and requesting mini statements on their
Facebook or Twitter accounts.
Planning to introduce more services like request for chequebook,

stop cheque, register for mobile banking, internet banking, SMS
alerts and block ATM/Debit Cards on this platform soon.
Innovations @SBI
SBI Digital Villages aimed at transforming villages into cash

less eco-system by adopting them.
In its first leg the bank has adopted 21 villages to be moved
on the digital platform and plans to bring 100 villages under
this initiative
Created a 15,000-sqft innovation centre in Navi Mumbai that

has 40 dedicated zones for each technology like blockchain,
artificial intelligence and machine learning, among others
HSBC Bank
HSBC Group is one of the world’s largest multinational

banking and financial services organization
Headquartered in London, has more than 5000 offices in 80

countries and territories
Apart from Retail Banking and Corporate Banking, HSBC has a

very strong brand name in Investment Banking and Treasury
Innovative Services @HSBC Bank
Fixed Deposit: Free Savings account, 90% overdraft

facility on the amount of FD, International Debit
Card
Certificate of Deposit: Interest is paid in advance

for funds invested from 15 days to 1 year. Minimum
investment is Rs.100,000
Smart Money Account: FD linked to savings or

current account. Withdrawal up to 90% through
overdraft facility and interest is earned on 100% of
FD
Financial and Digital Innovations @HSBC
Face Recognition for Mobile

HSBC has allocated $200 App: The software creates a
million globally for 30,000-point ‘depth map’
investment in fintech and of the face, which will adapt
enterprise start-ups to a person’s appearance as
it changes.
Financial and Digital Innovations @HSBC
Expanded its WeChat

HSBC is one of the first services to allow commercial
foreign banks since 2016 to banking customers in Hong
allow retail customers to Kong to receive notifications
access services through through the platform as an
WeChat. alternative communications
channel.
Quantexa, a big data start-

up, is supporting HSBC with
the bank’s work to combat
money laundering
Block-Chain Technology
Block-Chain Technology in Banking
7 banks namely Axis, ICICI, IndusInd, RBL,

Kotak Mahindra Bank, South Indian bank and
Yes Bank have signed up for the India Trade
Connect consortium
Which hired Infosys Ltd. to develop a blockchain

platform for loans that back ‘trade-transactions’
within India in order to speed up processes and
reduce hurdles to approving new loans.
Block-Chain Technology – Yes Bank
The traditional paper-intensive trade finance process within India

can take as long as 20 days to complete. Blockchain should reduce
those delays to less than a day.
Yes Bank brings Bajaj Electricals and 32 of its vendors on board

an invoice financing blockchain.
As against the current four-day process of manually presenting,
verifying and reconciling invoices before disbursing working
capital loans,
Yes Bank will finance the vendors real time on the blockchain
solution developed by Cateina Technologies.
Block-Chain Technology – HSBC & ING Bank
HSBC and ING Bank have successfully executed a live trade

finance transaction for company named Cargill using R3’s
Corda blockchain platform.
The transaction demonstrates that blockchain as a solution

to trade digitisation, is commercially and operationally
viable.
Conventional exchanges for paper-based documentation

related to letters of credit usually take between 5-20 days.
This exchange was done in 24 hours.
Block-Chain Technology – Axis Bank
Axis Bank launched two bilateral

blockchain-based inward remittance
solutions with RAKBank in the Middle East
for retail customers,
With Standard Chartered Bank, Singapore,

for corporate trade remittances.
30 banks and non-banking finance companies (NBFCs)

in India and the Middle East including State Bank of
India, ICICI Bank, Axis Bank and Yes Bank, share
corporate KYCs and more through BankChain - a
blockchain consortium set up by Fintech firm
Primechain Technologies.
BankChain, now known as Primechain Money

Insurance firms, are testing and implementing

blockchain solutions for insurance claims
AXA uses Blockchain for insurance against delayed

flights
IBM has set up a life insurance consortium with 13

private life insurers looking at sharing medical
records, among others.
The Central government and state

governments, like Andhra Pradesh, too, are
looking at using blockchain for land record
registries and public distribution systems.
The Reserve Bank of India's Institute for

Development and Research in Banking
Technology has also tested blockchain for
core banking processes.
Thank you

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MANAGEMENT OF

CHAPTER 14 – BANKING SYSTEM

Machine Learning (Big Data Analysis)

● Gone are the days when banks viewed Fintech

As of now, YES BANK has partnered with over 100+ Fintech

The participating startups will get access to YES BANK’s

Along with this, they will also receive funding up to $1

Real-time Data Analytics

Wealthtech and Investech

Private Sector • ICICI

Foreign Bank: • HSBC

• Established in the year 1994

• ICICI Group comprises of ICICI Bank and various

• Has a strong presence nationally and Internationally

First Bank in India to launch a Website

First Bank in India to launch Internet

First Bank in India to launch online bill

ICICI Bank’s e-wallet - called 'Pockets'.

Another aspect of Pockets is that it is linked to social banking -

ICICI's mobile innovation is its app 'iMobile'.

Unlike Pockets, this one is for existing customers

The app is also integrated with Google Now that

First private sector bank in 2013 to introduce 'Branch on

The idea was to take a sophisticated van - one that is

It offers services such as savings accounts, deposits and even

Expressions Paywave NFC (near-field

Biometric Authentication for

Tab Banking: Officer visits location of

Partnered with Flipkart to offer its consumers the facility

The EMI facility is available in 3 tenures – 6, 9 and 12

The bank does not charge any fees to process the

Using SBI Mingle, its customers can do a host of banking services

Planning to introduce more services like request for chequebook,

SBI Digital Villages aimed at transforming villages into cash

Created a 15,000-sqft innovation centre in Navi Mumbai that

HSBC Group is one of the world’s largest multinational

Headquartered in London, has more than 5000 offices in 80

Apart from Retail Banking and Corporate Banking, HSBC has a

Fixed Deposit: Free Savings account, 90% overdraft

Certificate of Deposit: Interest is paid in advance

Smart Money Account: FD linked to savings or

Face Recognition for Mobile

Expanded its WeChat

Quantexa, a big data start-

7 banks namely Axis, ICICI, IndusInd, RBL,

Which hired Infosys Ltd. to develop a blockchain

The traditional paper-intensive trade finance process within India

Yes Bank brings Bajaj Electricals and 32 of its vendors on board

HSBC and ING Bank have successfully executed a live trade

The transaction demonstrates that blockchain as a solution

Conventional exchanges for paper-based documentation

Axis Bank launched two bilateral

With Standard Chartered Bank, Singapore,

30 banks and non-banking finance companies (NBFCs)

BankChain, now known as Primechain Money

Insurance firms, are testing and implementing

AXA uses Blockchain for insurance against delayed

IBM has set up a life insurance consortium with 13