Internet-banking, anywhere-banking and anytime-banking will be introduced through 40 branches before March 31, 2001, in three phases. The Nedungadi Bank is planning to offer hi-tech products such as net-banking with the support of Flexcel International Pvt Ltd, a joint venture company floated by HDFC Bank and Iflex Solutions.

Unlike some of the other private sector banks, NBL's technology plan does not entail heavy capital investment, as the bank will be using the flagship product of Iflex, `Flexcube.' NBL chairman A Rajasekhara Moorthy, told The Financial Express that they opted for the ASP route because otherwise it would have costed them at least Rs 25 crore. ``Moreover, we don't have the capacity to go in for such a heavy investment.''

The board of directors of the bank, which met on January 25, has given the approval to the tie-up proposal, and a formal agreement with Iflex is expected shortly. According to the arrangement between the two, the NBL branches will be connected to Flexcube so that they can operate the ASP model on a `pay for usage basis.' In other words, the centralised data processing centre and application software will be with Iflex.

NBL, on the other hand, will need `minimal' investments for installing servers and getting connectivity from VSNL.

Moorthy further pointed out that any substantial investment for technology upgradation at this stage is not justifiable on account of the small volume of transactions. The banking software will be useful for retail, corporate and treasury operations as well as Management Information Systems (MIS).

Flexicube is being adopted by smaller commercial banks and cooperative banks in the country to avoid massive capital investment. In the first stage, all the five Mumbai branches will be provided the advantage of the new product.

Another 10 will be connected to it in the second stage, and the remaining 25 in the final stage. Currently, 58 NBL branches are at various stages of computerisation. With the new system in place, the computerisation level is expected to go up to 70 per cent of the operations by the end of March 31 this year.