Monday 19 September 2016

Trends to dominate the BFSI industry.




A market place is not a picnic spot, it’s filled with fierce competition. The ever-changing landscape, where riding on a trend can be the difference between tremendous success and utter failure. Here are the top local trends that BFSI industries need to follow to stay relevant and ahead of the competition.

Services will matter more than products –
To service is to sell is the philosophy to dominate the market right now and for coming days. Banks will leverage their rich customer data to "service first", rather than sell. Sales will happen because banks anticipate service moments. This will need large technology investments to sense "customer moments" and respond to them in real time. Banks will shift their beliefs from a product-oriented organisation to a customer-driven organisation. Customer will make the rules.

Paperless and online –
When it comes to the process of applying for a loan or opening a new account, customers desire speed, ease and transparency, along with instantaneous decision-making capabilities. These are no longer a luxury but instead have become a hygiene factor and a necessity. They would also like the power to customise as per their needs and more choices for financial products and service. Future banking will be online and paperless with digitisation. Tab banking and mobilebanking will take the throne. With the help of Aadhar platform, loans will be disbursed within mere seconds and virtual cards will be issued instantly

Personalisation will be the key
More effort will be put in to make the whole experience more personalised. India has more than 440 million millennials, more than China. This mobile-first consumer segment wants choice, convenience and personalisation; customised offers and an experience that is easy and intuitive while also being contextual. With infrastructure development and increase in smartphone usage, customers expect to use services anywhere, anytime. This is revolutionising the consumer experience. People are increasingly using mobile devices to research potential purchases, compare prices for goods and services and transact using mobile banking. 

Wednesday 14 September 2016

Contributor of Banking Liberalisation



It is true that the 1991 budget changed the face of the Indian economy, he changed the norms and enable private banks to be born. He changed the rules of the game, but there are many players as well who contributed largely in the uplifting the Indian banking sector from the shambles. N. Vaghul is one of them.

N Vaghul, former chairman, ICICI.
He ushered in the new financial segment.

N Vaghul did not build the institution, but he knew who could. If ICICI Bank and its affiliates have not only survived butt thrived and its executives are part of the Indian financial services landscape today, it is undisputed because of - Vaghul the visionary. Vaghul was a commercial banker who started his career in State Bank of India and became the youngest chairman of a state-run lender - Bank of India - at 44. He quit banking in disgust due to interference from bureaucrats.
But things changed when Rajiv Gandhi needed someone with financial expertise, then RBI governor RN Malhotra called upon Vaghul to head ICICI. He turned a staid term-lending institution into a vibrant financial powerhouse with interests ranging from stock broking to lending to infrastructure, with insurance and advisory rolled into the mix.

Many financial supermarkets have come into existence since liberalisation in 1991, but the thought leader for all of them was undeniably Vaghul. If IDBI, UTI and SBI all ventured into various wings of financial services, they all took a leaf out of ICICI's strategy laid down by Vaghul.
His ability to engage comfortably with people at various levels without being conscious of the hierarchy made him an acceptable and popular leader.

In pre-liberalisation days, when the public sector was the monarch of the economy, a job in SBI was considered an achievement. Those who got such jobs stayed with the organisation until retirement. But Vaghul quit to take up teaching at the National Institute of Bank Management when a militant Shiv Sena union was poised to make trouble for him as HR head of SBI. The party at that time had an anti-south Indian platform.

The Industrial Credit and Investment Corporation of India (ICICI), as it was known then, was no different from Industrial Development Bank of India (IDBI) or Industrial Finance Corporation of India (IFCI). If 25 years later ICICI is miles ahead, it is because Vaghul saw no future for the lender unless it was transformed.


ICICI Bank is today worth Rs 1.52 lakh crore; IDBI Bank, which had a bigger market share in the 1980s, is at about a 10th of that, while IFCI has almost faded into irrelevance.

The poster boy of banking liberalisation.



Before the 1991 budget by Dr Manmohan Singh that changed the face of the Indian economy, the government had the full authority over the economy and the banking sector. Banking sector had no sense of private entrepreneurship. Though the budget of 1991 changed the rules of the game, there were many players who made a tremendous contribution of their own in liberalising the banking industry.

C. Rangarajan, RBI governor (1992 – 1997)
Before 1991, the banking section was much different than today. There were no rules for bad loans, the bank didn’t have any fixed deposit schemes. There were no mentions of either profit or loss in banking sections. And to open a branch banks had to wait for months to get the RBI’s permission. There was no financial marketplace. RBI dictated the exchange rates based on what the bureaucrats felt it should be, they also decided who got loans. All in all, bankers did not do banking, they were mere executioners.

That is till the C. Rangarajan became the governor of the RBI, public sector banks are still largely in bad shape, but there're competition and consumers have been able to fund their dream homes and cars through loans. Also, individuals have made fortunes by buying bank stocks in two decades. All thanks to the banking reforms Rangarajan lead from 1992 to 1997.
Besides playing an active role in rupee devaluation as deputy governor, Rangarajan laid the foundation for modern Indian banking without having to turn the economy, markets and banks inside out. He was met with some resistance when he prescribed capital norms and he had to convince stakeholders that this was an essential step to make the system more vibrant, viable and reliable.
Under the leadership of Rangarajan, private banks came into being. He unleashed the competitive spirit in Indian banking, resulting in the HDFC Banks and ICICIs of today. He was instrumental in ending the government's monarchy over the banking sector and stopping its abuse of power and position by monetising debt, which had made monetary policy ineffective and undermined RBI's independence.

Rangarajan's imprint was not only confined to monetary policy, it also extended to the elimination of automatic monetization and a shift in the issuance of government bonds to market-based auction system that reduced the fiscal dominance of monetary policy and led to the development of government debt markets.


But, the unfortunate part is his reforms were discontinued after his tenure. The Narasimhan committee proposed the DE-liberalisation of the banking sector as the RBI became hesitant about moving ahead with the liberalisation because of a deep-rooted suspicion of open markets. 

Wednesday 24 August 2016

Business Process Reengineering


Business Process Reengineering involves the exhaustive redesign of core business processes to achieve astonishing improvements in overall productivity, cycle times and quality of work. In Business Process Reengineering, companies start with a blank sheet of paper and rethink existing processes and hold them in a way to deliver more value to the customer. They typically adopt a new value system that places increased emphasis on customer needs. Companies may reduce organizational layers and eliminate unproductive activities in two key areas. First, they redesign functional organizations into cross-functional teams. Second, they use technology to improve data dissemination and decision making.
How Business Process Reengineering works:
   Business Process Reengineering contains five major steps. Managers should:
·         Refocus the company’s values on customer’s needs.
·         Redesign the core processes, often using information technology to save time and make improvements.
·         Reorganize a business into cross-functional teams with end-to-end responsibility for a process.
·         Rethink basic organizational problems and people issues.
·         Improve business processes from top to bottom, all across the organization.
Companies use Business Process Reengineering to:
Companies use Business Process Reengineering to improve performance substantially on key processes that impact customers. Business Process Reengineering can:
·         Reduce costs and cycle time. Business Process Reengineering reduces costs and cycle times by eliminating unproductive activities and the employees who perform them. Reorganization by teams decreases the need for management layers, accelerates information flows, and eliminates the errors and rework caused by multiple handoffs.
·         Improve quality. Business Process Reengineering improves quality by reducing the fragmentation of work and establishing clear ownership of processes. Workers gain responsibility for their output and can measure their performance based on prompt feedback.

Why Banks opt for Tab Banking?

Why Banks opt for Tab Banking

Offering a collaborative, electronic process can meet your customer’s expectations and evoke a sense of loyalty. This can translate into greater customer retention and wallet share. Whether a customer is opening a new account, applying for a credit card or making an account change, tablets offer an interactive way for customers and representatives to complete a transaction.

From ICICI to the HDFC, every major bank in India offers tab banking. Although tablets are considered mobile devices, they have a place in a bank’s multiple business channels, including the branch. In fact, tablets could close the gap between the customer’s satisfaction rating and the bank’s perception of their service. In addition to improving customer service and potentially appealing to a broader audience, tablets offers a wide array of benefits to the banks, such as,

Going Paperless: By adopting an e-process that includes electronic signature capabilities, there’s no need to print and waste papers. The process is totally electronic from start to end, saving banks the cost associated with managing papers.

Multichannel Support: The same tablet application can be used in-branch, in-field and even by customers in the comfort of their own home. A similar process across multiple environments makes a bank’s multichannel strategy a reality while contributing to a better customer experience.

Collaborative Process: Instead of a stiff customer/representative interaction, tablets promote collaboration. 

Tablets are versatile devices that banks uses as leverage to improve the customer experience and benefit the organization by implementing paper-free, efficient processes.



Guidelines to make outsourcing in Insurance well structured.

IRDAI - Regulator Insurance Regulatory and Development Authority of India, has proposed outsourcing regulations for insurance companies operating in India, under which they can take services of individuals for activities such as medical examination, investigation of claims, and recovery. As per the exposure draft, every company should put in place a comprehensive board approved the outsourcing policy. In considering or renewing an outsourcing arrangement, an insurer should subject the agency to appropriate due diligence, the regulator said in the proposed IRDAI (Outsourcing of Activities by Indian Insurers) Regulations, 2016. “The insurer shall satisfy itself that the outsourcing agency’s security policies, procedures, and controls will enable the insurer to protect confidentiality and security of policyholder information,” according to the draft.           The new norms have been welcomed by the industry, as it will help regularize the outsourcing. As a better structured outsourcing mechanism can be put in place adhering to these rules. “The proposed regulations are trying to give a more structured and better shape to outsourcing activities by clearly defining core and non-core activities,” Puneet Sahni, Head-Product Development, SBI General Insurance, adding that the new norms will “positively” impact business processes and customer interests.          The proposed rules will bring more accountability, as outsourcing relationships will be governed by written agreements that are legally binding for a specified period. That clearly describe all material aspects of the outsourcing arrangement, including the rights and responsibilities of all parties.

IRDAI - Regulator Insurance Regulatory and Development Authority of India, has proposed outsourcing regulations for insurance companies operating in India, under which they can take services of individuals for activities such as medical examination, investigation of claims, and recovery. As per the exposure draft, every company should put in place a comprehensive board approved the outsourcing policy. In considering or renewing an outsourcing arrangement, an insurer should subject the agency to appropriate due diligence, the regulator said in the proposed IRDAI (Outsourcing of Activities by Indian Insurers) Regulations, 2016. “The insurer shall satisfy itself that the outsourcing agency’s security policies, procedures, and controls will enable the insurer to protect confidentiality and security of policyholder information,” according to the draft.
   
The new norms have been welcomed by the industry, as it will help regularize the outsourcing. As a better structured outsourcing mechanism can be put in place adhering to these rules. “The proposed regulations are trying to give a more structured and better shape to outsourcing activities by clearly defining core and non-core activities,” Puneet Sahni, Head-Product Development, SBI General Insurance, adding that the new norms will “positively” impact business processes and customer interests.

The proposed rules will bring more accountability, as outsourcing relationships will be governed by written agreements that are legally binding for a specified period. That clearly describes all material aspects of the outsourcing arrangement, including the rights and responsibilities of all parties. 

Why Vietnam is becoming the next big Outsourcing destination?

Why Vietnam is becoming the next big Outsourcing destination?


Offshore outsourcing is a time-tested way of saving on cost that almost every multinational company has accepted and used. Outsourcing the business processes in an emerging economy enable them to create the infrastructure and get the labor at a much cheaper price, than their native country.
  
Once India used to top the list of nations preferred for outsourcing, but that is changing. With the India’s economy reaching new highs every year, even surpassing the China in the race. In this growing economy where youth is getting better prospects than before and with middle class getting more and more empowered, the low labor cost might soon disappear. Foreseeing this, outsourcing companies are looking for new destinations to outsource to. And they are eyeing the Vietnam.
    
Vietnam’s economy quietly slipping, with the worst drought in the last decade country is far below the ambitious GDP aim it had set for itself. It’s becoming the next hot destination for offshore outsourcing. With Vietnam’s talent pool increasing in technical areas and modern tech infrastructure, as well as its reasonable rates, mean it’s catching the attention of tech companies big and small.

“The Vietnamese have a very strong desire to work with other parts of the world because they value the positive flow of money and funding coming into their country,” said Anna Frazzetto, chief digital officer and senior vice president at recruiting firm Harvey Nash. “All the big players are setting up their own facilities. If the companies that are the gold standard in technical competency are setting up house in Vietnam that says a lot about the technical talent Vietnam is offering.”

Thursday 23 June 2016

Cryptocurrencies


 Digital Archive


While bitcoin is the most salient and top of mind in the Financial Technology (FinTech) world, many altcoins have emerged as more specific and affordable options, especially in the USA and the UK. Many others have made decisions against digital currency, for reasons ranging from ignorance to ambiguity to protectionism of national currency. Crypto currencies are basically peer-to-peer digital currencies that use cryptography as lead security system. The laws about crypto currency are in a grey area across most parts of the world including India. Since it's a P2P currency, it is impossible to regulate a population using bitcoin as currency and the logistics to monitor a mass population is almost impossible. At the moment there's no verdict on the legality of virtual currency in India.

Tuesday 21 June 2016

Outsourced Compliance Monitoring and Reporting Services

 Outsourced services


BFSI organizations across the world are facing the challenges of tighter regulation and having to deal with disparate information systems. Outsourced services of Archis Business Solutions Pvt Ltd can help you streamline business and statutory reporting processes and enable inter operable data communication. From Capital Adequacy Reporting to Credit Management, from MIS to Risk Management, and key internal processes such as loan and credit management can significantly save on time and costs with outsourcing of these services to established domain experts in this field. 

Archis Services for Compliance Monitoring and Reporting

 compliance solutions


With modification in existing regulations and addition of new ones, financial institutions are faced with a host of challenges in keeping abreast of these changes. There is an immediate need of putting in place an effective and dynamic compliance framework that is responsive to market and regulatory development. Archis Business Solutions’ Compliance and Regulatory team provides expert assistance on regulations and compliance and provides a comprehensive compliance framework to customers.
For companies to stay relevant, process and system enhancements are required to cope with the increasing demands. We ensure accuracy and punctual information transfer to assist our customer in staying relevant. With Archis’ services, companies can roll out innovative products without being tied down by regulatory implications or disclosure requirements.

Our Compliance and Regulatory team is comprised of technicians and professionals with 30+ years of broad ranging experience of providing effective solutions to financial institutions. Leveraging on our insightful knowledge and deep understanding of the regulatory requirements within the financial services industry, we are able to assist you in understanding and responding to increased challenges that banks and other financial institutions face in the regulatory regime.

COMPLIANCE MONITORING AND REPORTING

 compliance solutions


Compliance laws, rules and standards generally cover matters such as observing proper standards of market conduct, managing conflicts of interest, treating customers fairly, and ensuring the suitability of customer advice. They typically include specific areas such as the prevention of money laundering and terrorist financing, and may extend to tax laws that are relevant to the structuring of banking products or customer advice.
The expression “compliance risk” is the risk of legal or regulatory sanctions, material financial loss, or loss to reputation a bank may suffer as a result of its failure to comply with laws, regulations, rules, related self-regulatory organization standards, and codes of conduct applicable to its banking activities (together, “compliance laws, rules and standards”).
A bank that knowingly participates in transactions intended to be used by customers to avoid regulatory or financial reporting requirements, evade tax liabilities or facilitate illegal conduct will be exposing itself to significant compliance risk.
Compliance laws, rules and standards have various sources, including primary legislation, rules and standards issued by legislators and supervisors, market conventions, codes of practice promoted by industry associations, and internal codes of conduct applicable to the staff members of the bank. For the reasons mentioned above, these are likely to go beyond what is legally binding and embrace broader standards of integrity and ethical conduct.

It is in such a scenario that outsourced services of Compliance Monitoring & Reporting by companies such as Archis Business Solutions Pvt Ltd gain significance. While theoretically compliance should be part of the culture of the organization and not just the responsibility of specialist compliance vendor or staff, nevertheless, a bank will be able to manage its compliance risk more effectively if it outsources the compliance function to a specialist organization where the required structures are in place and the processes are fine-tuned over time with the “compliance function principles”. Apart from the obvious saving on manpower & training costs, with properly documented division of responsibilities, the inherent risks are almost completely mitigated!

Friday 20 May 2016

Make In India – Leveraging Human Capital to Prosper in a VUCA World – Bridging the gap


transaction processing

Current Initiatives
While the 2015 Ernst & Young report on the subject highlighted that institutions such as ITIs are unable to meet the industry requirements of skilled manpower and outsourcing, leading to an increased reliance on the private and diploma institutions, the stated reasons for this preference being gap in technical curriculum as per the industry needs, lack of exposure of the teaching faculty to the changes in technology and up-gradation of infrastructure at ITI’s, the government has stepped in to amend the Apprenticeship Act as a start to addressing these pain points by:-
·        Dismantling of trade-wise and unit-wise prescribed numbers
·        Setting the minimum and maximum limits on number of apprentices to be engaged
·        Linking of the stipend to minimum wages for apprentices
·        Inclusion of all undergraduate, postgraduate and other approved vocational courses
·        Revision of curriculum of apprenticeship courses to align to industry requirements
·       Focus on bringing self-regulation and monitoring in the industry rather than enforcement by state through penal measures
·         Online portal for bringing in speed and transparency in approvals
Developing a competency-wage grid
A lack of commonly accepted standards which define the required levels of competencyfor an individual, and correlates the same to an ideal wage was another key challenge, that is being addressed by  development of the National Skills Qualifications Framework (NSQF). NSQF lays down the competency framework and standards with respect to levels of competency for many trades in the industry, by
·   Creation of National Occupational Standards (NOS) for various job roles by sector skill councils (SSC).
·    Establishment of 10 competency levels thereby enabling vertical mobility in terms of skill levels.
·       Inclusion of competency levels that can be acquired by educationally disadvantaged/ school dropouts, 10th/12th pass-outs thereby, enabling them to acquire skills for livelihood.

However, to ensure success, the Government needs to put further impetus on the execution of the above initiatives and collaborate with industry to ensure sustainable success. Industry Initiatives of designing and introduction of specialized courses in partnership with academia, leveraging of technology & new methodologies to supplement OTJ, and setting up of training centers by the larger organizations to train employees as well as ecosystem partners will be critical in taking ‘Make in India’ to its logical successful completion.

Make In India – Leveraging Human Capital to Prosper in a VUCA World – The 3 Key Principles


 outsourcing

Special Forces
Rather than a traditional hierarchical structure, SMEs will increasingly have to rely upon small, multidisciplinary, autonomous teams dedicated to achieving a particular goal in a finite time. Hiring these teams, or at least a large part of them, on an as-required temporary basis, while being counter-intuitive, will certainly be the place where value is created – optimizing the contribution of the workforce thanks to their multidisciplinary expertise, commitment and motivation.
Extreme agility
In the VUCA world, it is vital for firms to respond quickly to any change in their circumstances, realigning themselves without delay. This requires a large amount of decentralization: A strong decision-making command unit combined with the freedom of local entities to make their own decisions. The decentralized units will thus need ‘thinking’ rather than ‘doing’ heads.
Openness

In today's increasingly complex world, it is unsurprising that the most successful actors are those who build the strongest collaborative partnerships – with different firms, customers, public services, researchers, local partners, and others. Such collaboration will need to go beyond mere business commerce, and will need concepts such as ‘shared talent’ and outsourcing to be increasingly used in day-to-day operations.

Thursday 12 May 2016

Make In India – Leveraging Human Capital to Prosper in a VUCA World – Tech Is In

 Archis business solutions


VUCA is an acronym used to describe or reflect on the volatility (The nature and dynamics of change, and the nature and speed of change forces and change catalysts), uncertainty ( The lack of predictability, the prospects for surprise, and the sense of awareness and understanding of issues and events), complexity(The multiplex of forces, the confounding of issues and the chaos and confusion that surround an organization) and ambiguity (The haziness of reality, the potential for misreads, and the mixed meanings of conditions; cause-and-effect confusion) of general conditions and situations. The common usage of the term VUCA began in the 1990s and derives from military vocabulary and has been subsequently used in emerging ideas in strategic leadership that apply in a wide range of organizations, including everything from for-profit manufacturers to education.
Embracing Technology
Those likely to survive, and prosper in today’s increasingly VUCA environment are technophiles, i.e., those constantly innovating and integrating external technological innovation into their business models. The world is becoming less linear and turning into a complex adaptive system. This necessitates a seamless integration of industry, especially SMEs with their limited organic R&D capability, with related academia. Through this the super-technophile younger generation needs to be oriented towards specific skill sets critical for the specific sector.
Cybernomics

This is simply the ability to leverage new technology, in particular Web 2.0, big data-mining capacities and digitization. Here again, the SMEs that are able to win a decisive advantage in this fifth domain by achieving maneuverability and keep their organization lean& high-value, with their modular structures ensuring agility, will prosper the most. 

Make In India – Leveraging Human Capital to Prosper in a VUCA World – A Beginning

 Archis business solutions


An effective “Make in India” initiative for the Indian industry is expected to create a globally competitive industry serving both domestic and global markets. This implies an equivalent increase in demand for a world-class skilled workforce and outsourcing. “Make in India” will increasingly require organizations to further enable their HR functions for identifying the capabilities required for business continuity and future growth and also ensure attraction, retention and nurturing of talent.
The manufacturing sector is now seen as competing for talent with other sectors such as IT/ITES, Service, etc. The challenge of talent attractionemploy-ability and retention, for manufacturers is getting increasingly complex.
SMEs especially find it difficult to attract top notch talent at all levels. The talent acquisition process in these organizations does not enable hiring talent with right skills and behaviors. Further, these organizations find it difficult to retain any high performing talent. Some of the reasons contributing to this are:
•  The demand for qualified talent far outstrips what is available readily.
• Aspiration of high performers to move up the value chain and look at wider and challenging opportunities with larger organizations/ OEMs.
• Limited attractiveness of career with dealers and smaller vendors as the culture, career
growth opportunities and work environment may not be most conducive.
Building HR process robustness, especially with the respect to hiring, salary levels and career path creation to meet the above challenges therefore requires increased attention.
Skill development of the large talent pool is seen as the most critical lever in delivering under the “Make in India” initiative. However, the industry is faced with certain key challenges with respect to skill development:
·         Whether the available resource pool is industry ready, and whether they have the requisite skills set to deliver on manufacturing & R&D excellence in a VUCA environment?
·         Are there any new skills which have emerged critical for the industry?
·         Are the current government & industry initiatives sufficient?

Wednesday 27 April 2016

Document Digitizing and its Advantage


 Converting paper document into digital format is known as Document digitizing. By converting your documents into digital formats, you can preserve your documents. Services allied with such conversion work are termed as Document Digitizing Services. Any kind of document or data, right from texts, images, audio, video, can be digitized and converted into:
  • A digital format such as text, html, xml, pdf, doc, xls, giff, jpeg, tiff and mdb amongst others
  • Any media such as CD, tape, or Zip disk
Further, digitized documents can be shared with anyone, irrespective of the geographical location, through data sharing mediums like Internet, FTP, VPN, and Telnet.
















Advantages of document digitizing
 There are many benefits of shifting to digitized documents. Digital documents and data are:
  • Easy to preserve
  • Easy to store, retrieve and update
  • Easy to clone
  • Quickly accessible
  • Easy to share and transport
  • Compatible with all modes of digital data transfer