How NexGen technologies reshaping Indian BFSI sector
Technology Rebuilding the Future
The banking sector in India is geared up for a transformational space in the next decade. With technology progressively becoming a crucial part in the household and digital servicing domains, we are not far from the time when customers would place their trust in robots or artificial ‘chat-bots’.
Implementation of advanced technologies such as applications of Artificial Intelligence (AI), Machine Learning (ML), Block Chain and Robotics, FinTech is now perceived to be the next big driver in a few years.
“Digital landscape is evolving at a very fast pace. If we observe the trend of technology implementation a decade ago, AI, Machine Learning, Chatbots, IoT and Blockchain were still a matter of curiosity. Back then, it was predominantly adopted by the stakeholders across the retail sector. These technologies are predicted to have a great future across the BFSI sector and AI, in particular, is expected to result in 30 percent cost saving and 20 percent increase in the revenues,” said Abhijit Shah, Chief Technology Officer, DCB Bank.
Fact Check
A recent report by McKinsey on the use of technology in the BFSI sector mentioned that more than 30 percent of tasks in the industry will be taken over by machines by 2022.
As of now, financial institutions only use 0.5 percent of their Big Data and are increasingly realising the unused prospective in accessing and effectively using the rest of the technology. As a result, the claim for skilled data scientists is inflating. In fact, data scientist jobs in India rose by 400 percent in the last one year.
Blockchain technology is enabling several digital banking processes such as collateral management, Know Your Customer, smart assets and more. As of result of this, blockchain jobs have seen a 400 percent increase with salaries shooting up by 50-100 percent, in the past year alone.
“E-KYC as a used case has evolved over a period of time. It is one of the readily available examples of AI implementation in India. This particular model has a lot of challenges associated with it but despite that, it is one of the best digital ways to connect a customer with the bank without even visiting the branch physically,” said Sunil Soni, General Manager-IT, Punjab National Bank.
“Life insurance sector is a bit different from other insurance categories. The moment we ask a customer to get his medical test done prior to insurance, there are chances of him opting out. This is the scenario across 60 percent of the customers. So, to avoid this we make use of technologies like AI and ML to analyse the status of the customers without any medical examination,” said Srikanth Ramasubramanian, Senior Vice President-Business Systems and Technology, HDFC Life.
Conclusion
However, with the increasing deployment of technology and innovation the risk of getting infected to the malware also inflates. It is, therefore, important to verify the technology invitation prior to allowing it into the phones or computers.
“Great opportunities are associated with technologies namely AI and ML. But India is different and diverse. Here every state has different dynamics. In India, the biggest challenge is from the regulation point of view. You have to inform the customers that you are using his data and reason behind it. But again, if you provide lucrative offers, people in India willing allow all usage and agree to all the conditions,” said Lalit Popli, Head-Information Technology & Chief Information Officer, ICICI Prudential Asset Management.
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