Technology-led business transformation is an area of immense interest to Haragopal Mangipudi, global head, Finacle, Infosys Technologies, and he has been closely engaged with global banks in their transformation initiatives for the past decade. With over 22 years of experience, at Infosys, Haragopal is responsible for running the business of Finacle worldwide. Finacle Universal Banking Solution (UBS) has a global presence?with more than 100 leading banks in 60 countries across five continents as its customers. ?I breathe and live Finacle,? he says. After a double degree in Physics and Law, and later management from the Indian Institute of Management, Bangalore, the transition to technology was a natural one for Haragopal. ?From very early, I took the lesser traversed paths. While my peers took to the services, I took the product part of it. Creating IT intellectual property and creating the multiplier benefit excited me,? he stresses. In a recent interaction, he tells FE?s Sarika Malhotra how innovation and technology is cardinal for banks to compete better. Excerpts:
You had pointed out how products are an excellent transition to take IT to the next level. We now have global attention and global respect and we need to continue to launch new offerings and products, but there is this entire debate around products and service deliverability. What?s your take on it?
I don?t think its X or Y?it?s ultimately the value to the customer which determines all. You can never look at business from your lens; you always need to look at it from the lens of the customer. As banks today are service organisations, there is continuous need for them to work on efficiencies and differentiations. So they need to offer better price points, better services to the customers and bring in the trust element. In today?s times, faster, cheaper, better is the mantra for them. So if you have to do a little bit of service around their integration and mergers and acquisitions, look at their IT infrastructure, bring portfolio analysis to their infrastructure and do performance engineering?all of them are in the game.
India is talking extensively about financial inclusion. What role can technology play in bridging the gap?
Financial inclusion is an enormous opportunity, which is micro-banking and is not limited to microfinance. Whatever you are trying to do for your retail customers, similar offering in different product definitions have to be brought for this micro segment? where the ticket size could be smaller but the expectations could be similar. The Finacle Inclusion System fits very well; on one side you have the core banking solution, on the other side you have the point of transaction devices, the business correspondents, and financial inclusion solution fits in the middle well?as it helps connect, aggregate transactions, do real time transactions and help in all activities?whether it is on-boarding the customer, providing account statement to customers, validation of customer through biometric or a smartcard.
We have a comprehensive solution for micro-banking, and believe that in the future it will change the landscape of Indian banking. The pilots are going on with some banks, and there is a lot of interest around it. A bank which earlier took 100 years to get 40 million customers will get the same number of customers in the next 36 months?the thought is compelling. That kind of magnitude can?t be possible without the scale and reach. Through Finacle core banking, we have proved that 100 million transactions per hour is a reality and it is working and through the mobile devices, you can bring penetration and don?t need a branch to service the customer.
This year?s budget talks about granting new banking licenses to private players. How do you perceive the move?
Let me take the banking partner view on this. The more opportunity for customers to reach out, the better it is. Today technology is great leveler. So if there is a foreign bank on one side of the spectrum and a cooperative bank on the other side of the spectrum, once they are empowered through technology, it will be good for the customers to have more access whether, it is through increasing the existing branch networks or adding new players. Ultimately, you need to have greater population to be covered through the financial system. India is positioned very well. In the last 10 years, Indian GDP increased by 182%, deposits increased by 500%, advances by 300%?and all this growth happened with the 5% increase in the workforce. There is tremendous headroom that technology will make. Given the highest amount of remittance flow to India, are you developing any specific product catering to the NRI/remittance market?
We do not have a segment-based approach, but the ability to give a segment of one approach. The Finacle Advizor can work as a great product for this segment. If an NRI doing internet banking needs to talk in a specific window of time to my relationship manager, he can do that. All it takes is internet with a push to talk via unified communication technology with a triple play of data, audio, video?you can connect from anywhere in the world. Both you and your relationship manager can track your internet banking stream.
Banks can really leverage from this offering, because this segment has been pampered with services in their respective countries.
How are regional rural banks placed when it comes to core banking solutions?
We have had a fantastic success, not from a will point of view, but from an execution point of view. We have shown that technology is not just for the urban India, it can go really up to the rural India. In the last four and half quarters, we have signed close to 30 plus banks. 13 regional rural banks (RRBs) have already implemented core banking, 8 are 100% on Finacle core rural banking stream. All the fruits of this technology in terms of innovation, efficiency, product launches are being brought to the rural banks and it has been a very exciting.
With this, you are bringing in the conviction that technology is not only for select few, it?s for everybody. Per capita expense for banking technology in the West is $76, but in India we can do it for $14.
What will be Finacle?s focus areas for the future?
We will have many focus areas. Innovation is not what I launch; it?s more how I am able to enable the banks to make good use of it. Inclusion is a classic case of innovation?it?s a business model innovation.
Also there is process innovation, multi-entity innovation and differentiated customer experience which banks are looking for. Lets not forget, the mid-market segment, which is not high networked. The whole client analytics area is very exciting for us, as 80-90% spend has to be analysed to track spending patterns and based on that provide service offerings.