The implementation of this software from Infosys stable will see these RRBs undergoing a transformation in terms of connectivity, centralisation of data and enhancement of customer service, along with innovation in banking products, said RIS Sidhu, chief general manager, Punjab National Bank (PNB). Finacle will be implemented over the next 12 months across six RRBs covering 1,300 branches.
By March 2010, we expect we expect the branch strength of these banks to go up to 1,500. We, however, are implementing the technology for 2,000 branches, added Sidhu. There are around 90 rural banks in the country, which are sponsored by three agencies - the Centre, states and PNB. Six RRBs come under PNBs network.
Haragopal M, head, finance, Infosys, said, In todays financial environment, accessing the bottom of the pyramid has become a key business necessity as well as social imperative for banks; technology is the key to reaching them. Infosys core banking solution Finacle has 32 customers in India; it enjoys a 65% market share in the space.
The contract with PNB includes licensing of software, deployment and maintenance, said Haragopal. Both sides were tight-lipped about the size of the contract in monetary terms.
According to a mandate by the Reserve Bank of India (RBI), all commercial and rural banks are supposed to implement core banking solutions by March 2010. Though these solutions have been successfully implemented by most commercial banks, RRBs are yet to implement the technology.
To fund the successful roll-out of such solutions in RRBs, the RBI is working on providing seed capital to these banks. However, in case that doesnt happen, Sidhu said that the bank will adopt a pay-as-you-use model. If implemented, this model will see each rural bank branch paying a fee of Rs 5,000 or more to use the technology provided by PNB.
Bridging the divide
Infosys Finacle will be implemented across six RRBs covering 1,300 branches
There are around 90 rural banks in the country, sponsored by the Centre, states and PNB
All commercial and rural banks are to implement core banking solutions by March 2010