How has the Indian banking sector and particularly SBI transformed itself over the past few decades?
One of the big positives for SBI has been the legacy, being a bank since 1806 in different avatars. SBI has grown to such an extent that you will find one at every nook and corner. We used to joke that you will find a post office or insurance office at every nook and corner but it is this bank that you find everywhere.
The entire country is under my charge so I have traveled the length and breadth of it, visiting small towns and remote areas. Over the past 20 years, the entire scenario has changed. In 1970, we did the first transformation, beginning with market segmentation; targets were set, different verticals were created, it was more like restructuring. In the 1980s, we set up zonal offices. In the mid-nineties, we had a vertical split of CAG (large caps) and the genesis of computerisation commenced. At that stage it was branch computerisation. When the new millennium came near, private sector banks were offering core banking solutions (CBS). To do that we redesigned processes also, went in for business process re-engineering. In 2000-03, we created vertical for medium sized corporates. CBS started coming in from 2003 and it was fully implemented by 2008. Now every new thing we do is CBS. We also started a massive roll out of ATMs. Between 2006-1010 we ramped up.
We are focusing on customer convenience. How do we do it? One way is to open up new brick and mortar branches. However, this is not always possible. It requires a lot of expenditure and facilities. We are facilitating this through ATMs, internet banking and mobile banking. I am told the SBI internet banking platform is pretty good. More customers are coming and we cannot have large branches everywhere. Even when we open a branch in a village within a month or two it is crowded, with financial inclusion. We are managing the expansion by catering to individuals through providing alternate methods of doing banking and also reorienting staff.
In 2007, SBI initiated ‘Parivartan’ whereby every manager level person was explained that we have to change the way of working, culture, focus on customer service. There is scope for improvement and we are working on that. The entire process was to measure up to private sector banks and beat them. We are having about 16-17% of the market share against competition. We have 5 associate banks; add them and it comes up to about 25%.
How do you balance traditional values and modern technology?
Technology is a given. We need to reorient the staff to engage customers through technology. We had the advanced age of staff earlier, but now the people are retiring and the younger generation is coming in. They are more aware of what technology is about, doing things more effortlessly.
What have been the ‘makeover’ efforts?
We have had focused publicity campaigns to make people aware of what we offer. SBI is the single largest provider of home loans. The aspiration of young people is to have their own house and we can provide that service. NPAs have been very low. We are trying to tell the customer that we are as close to you as possible. We are trying to cater to every segment of customers. We are having a presence on facebook, twitter, the use of social media connects us to the youth segment.
There are families where many generations are SBI customers?
We have several generations banking with us; it is a matter of trust. They prefer us over other banks even though they are giving a half percent higher interest. We are now focusing on improving customer service to cater to their requirements in a better way.
Being a PSU bank, SBI has responsibilities that private banks do not?
In 1955, the entire thrust of SBI was to help people in rural areas. We have been doing CSR for the last 40 years, we just called it community banking. SBI has become more focused in the last 3-4 years, on aspects like healthcare, education, institutions that contribute to the handicapped...
How do you see the trends for 2014-15?
We should see more of banking in the electronic mode, more offsite banking. ATMs will be the first point. Cash deposit machines are providing to be quite successful, especially for small businesses, shop keepers, etc. The are very popular in South India, Kerela, Karnataka. They save the need for standing in queues in front of the teller to deposit cash. We have recorded 100-150 deposit transactions in a day at some machines. We have introduced a ‘Green Remit Card,’ which is especially useful for migrant labour. They deposit the money here and their family can immediately withdraw it at home. It is a paperless transfer. Similarly, we have a ‘Green Channel’ where if you have an ATM card, you can transact business without filling forms and slips, so it is paperless banking.
We would never charge for access to brick and mortar branches like some banks do, instead our thrust is on making alternative mediums so user-friendly that customers will prefer to use them instead.
What are your plans for SBI going forward?
We want to make SBI the best bank in India!