The focus will be on analytics, mobile, and improved customer experience

—KP Sunny  CIO, Federal Bank

KP Sunny took charge of the IT Department of Federal Bank in March 2012. He is a graduate in Commerce with diplomas in Business Finance, Application Programming and Web Applications. His interest in computer technology saw him shouldering many IT related assignments including computerization of Bank’s Service Branches and Treasury Department. He was a member of the RBI Committee to test the Negotiated Dealing System (NDS) when it was first introduced and has also helped in the formulation of the Business Rules for NDS. In an interaction with Dataquest, he talks about the current status of IT at Federal Bank, the challenges they face, and their future plans in infrastructure and applications. Excerpts

What is the current status of IT at Federal Bank?

We have formed our IT team as early as 1985. Since then the bank has a policy of hybrid development and the bank’s team gets involved with the vendors as far as possible. This has paid rich dividends for the bank and today many of our major projects are being managed by our own team members. Datacenter, CBS, Net Banking, etc, are some of the examples.

From the very inception, the bank has been investing in its own infrastructure. It has also invested in all major platforms which helps to have centralized operations serving 1,300 branches spread across the length and breadth of the country. Its DC, DR and command centers are all ISO 27001 certified. The bank makes use of Enterprise Service Bus for seamless integration with multi-channel delivery systems. We have tied-up with around 78 exchange houses and banks for seamless online inward remittance. Last year, the bank introduced the first ever mobile based passbook which won the first IBA award for innovation.

It is a matter of pride to us that for the last two consecutive years, our bank has won the award for the best IT Team instituted by IDRB.

Can you elaborate any of the measures to demonstrate impact of IT in the bank?

IT is central to all the functions of the bank. All major activities like account opening, loan origination, stressed account management, etc, are centralized. We make use of well-known platforms for HR Management, DMS, loan origination, etc. Bank also offers all major delivery channels like Net Banking, Mobile Banking, Kiosk, ATM, POS, Telebanking, etc. BI tools, Dashboards and CRM lend a hand to the business teams to take learned decisions. Both the front office and back-office cannot function without IT support.

What are your future plans for infrastructure and applications?

We plan to improve our infrastructure and application in proportion to the business needs and the general market trends. The near future focus will be basically on three areas, namely Analytics, Mobile and Improved customer experience. Under analytics, we are embarking on a journey of Customer Profiling, Analytical CRM and campaign management. Mobile apps are capturing the common man in his day-to-day activities. Presently our mobile banking app is undergoing a face shift so as to be in tune with the current trends. As we move forward, application for internal use is also planned in specific areas like HR and application processing. This will bring in the need for a sturdy MDM and DLP solution. To increase the customer experience, we plan to strengthen our core system Finacle—our CBS. Bringing together various services offered through the channels, to offer an omni channel experience to our customers is also being envisaged.

What key business challenges are you planning to address with IT?

To be at pace with the demands of the customers is a challenge. We are now in a situation where the customer demands are fast changing. Faster account opening is one challenge we would like to address. Understanding the customer needs and then propose suitable products is another challenge. This is one area we would be concentrating in the near future. More professional way of doing fraud monitoring and pricing products based on relationship value, offering an omni-channel experience to our customers are other areas of interest to us.

How are they using or planning to make use of SMAC?

Our endeavors would be to have better presence in social media and want to accept customer requests through this channels. We have formed a separate team for mobile based development, considering the importance the channel is acquiring. We are now in the process of setting up an analytics team to help us in cross selling and upselling. Cloud, we could experience the convenience of the cloud offerings but security concerns still prevent us from storing/processing sensitive data in the cloud. As of now we use cloud only for extending publicly available data like website and for non-sensitive data.

What challenges do CIOs face in an organization?

Managing IT of a bank is a challenge in itself. This is all the more true in the case of managing people within the rules of a well-controlled banking industry, as many of them might have IT Industry background. Mapping the business requirements to budget constraints throws up its own challenges. Business expectations and market pressure many a time does not leave much time for going by the textbook development and testing cycles. While business departments wants to help their customers all the way, risk department wants checks and warning signs all along the road. Balancing these two activities are at times left with the IT department. Always, there will be tech savvy customer waiting for latest technology products. On the other side, a group who needs handholding at every bend. Innovation is the next challenge which is a necessity to survive in today’s market. We face challenges from people who are for it and others who want to be most cautious about it. CIO needs to be acting as an extension of business in IT and as an extension of IT for the business. Maintaining the balance is the biggest challenge a CIO face in the organisation.