Gearing up for an era of competition from digital banks, State Bank of India (SBI) is working on a revamp of its Yono mobile application to build it into a pure digital bank. Called ‘Only Yono’, the new platform will be enabled with cloud capability to handle high volumes and offer a superior customer experience.
SBI is the second major bank after HDFC Bank to have begun strategic planning for a likely round of digital bank licensing in the near future. A notice put out by the state-owned lender takes note of the Niti Aayog’s November 2021 draft discussion paper on licensing of digital banks, which may lead to formal guidelines by the regulator to establish various types of digital banks in India.
“Only Yono is envisaged as the next generation of Yono, which will make SBI ready to launch a complete digital bank with a leaner and modular architecture, more streamlined journeys, sleek and personalised customer-centric design and capturing value from ecosystems,” SBI said.
The bank has invited bids from consultants who will provide technical guidance for the architecture and design for Only Yono. SBI recently hired Nitin Chugh, who earlier led HDFC Bank’s digital banking division, in a similar role.
Yono, launched in 2017, is a digital banking application created to cater to the banking and lifestyle needs of SBI’s customers in an omni-channel format. Its original design consisted of a digital bank, a financial superstore and an online marketplace run in collaboration with merchant partners. Over the years, the app was updated to offer Kisan credit card (KCC) review services and agri gold loans to farmers, along with advisory related services and market linkages. It also offers services for SBI’s enterprise borrowers and global customers.
SBI’s investor presentation for Q3FY22 said Yono has acquired 4.54 crore customers since its inception. The app was used to open nearly 29,000 digital savings accounts on a daily basis during the quarter and disbursed pre-approved personal loans worth Rs 6,283 crore. Over two lakh KCCs were reviewed and agri gold loans worth Rs 8,551 crore were sanctioned through the app.
“Though Yono has been adopted by customers at a very high pace, in order to consolidate its leadership position, it has been decided by the bank to give Yono a revamp as ‘Only Yono’, not only in terms of features and functionality, but also in terms of ease of use and customer experience,” SBI said in its notice.
While former SBI chairman Rajnish Kumar was in favour of hiving off Yono as a separate subsidiary and listing it, current chairman Dinesh Kumar Khara has been reticent about the timeline for listing.