"IT helps us innovate and improve"
How strategic is IT at HDFC?
Retail is a significant portion of the bank’s strategy. In such a scenario, technology takes different shapes and dimensions since we have to deal in volumes. We already have a large customer base, and are looking to add three to four million customers annually. The ability to handle this volume— only a robust IT can offer. Also, 80 per cent of credit cards are sold to the existing customers. Today, the retail assets are focused more toward existing customers. The expensing will have to do with huge size of volumes. On the wholesale banking end, we are the second largest bank in the country, and that cannot happen without IT. The bank is investing a significant amount of money, time, and energy towards IT.
To what extent has IT enabled business innovation at HDFC?
It has helped us innovate and introduce more features to our customer centric services. As an illustration, we have introduced a feature named my favourite transaction in the ATMs. The backend keeps a tab of a person’s behaviour at the ATM. Suppose A removes X figure from the ATM each time, there will be a direct screen pop-up asking him/her to chose the favourite transaction. So instead of filling up the nine screens, A ends up filling four screens. It saves a lot of time for the bank and for A as well. This is the value add. The service has already gone live.
Yet another example could be the marketing calls people get. Assuming that there are some people who have not registered for ‘Do Not Call’ registry and want to avail the service. Somebody is in a meeting and gets a call for an auto or a home loan or some such. The person says if we can talk later? The message is saved, and each time the person accesses ATM, net banking, the message pops up in the receipt or the site. The message goes only to him and not everybody. The service has gone live in Pune and we will soon extend it to other places.
As a result, the bank has witnessed a higher hit rate for the products. Such innovations not only increase productivity, but also increase revenues.
It has been some time since you took over from C.N. Ram. Are you now settled as HDFC’s CIO?
I came here on May 23, 2007. It has been seven months, and I feel firmly in place. In fact, it has been a smooth transition. My predecessor has done an outstanding job building the architecture and solutions. Now we are outbuilding ourselves. We are now increasing investments into virtualization, BI, SOA, and are taking the IT architecture at HDFC to the next level.
Can you elaborate on what you are planning on the technology front
A lot has to be done in terms of taking the technology footprint to a new platform. We have already migrated eight applications of the Centurion Bank on to the HDFC platform. The current BI solutions and the data warehouse backbone are also being evaluated. We want to upgrade the BI platform, and are evaluating vendors for the same. We will however, continue to use SAS for some of the applications. We are also planning to take our core banking solution, which was deployed 14 years back, to a new level. We want to consolidate applications, bring in a lot of new architecture, and make SOA into a larger element.
Information security is a major concern in the BFSI vertical. Hackers are getting increasingly sophisticated. How is HDFC dealing with this concern?
Information security is definitely of concern to us. We do have a chief information security officer (CISO), who does not report to me, but reports to the risk head. However, the security measures and IT decisions are taken by the IT department. One has to understand that security is not only IT. IT is a critical strategy but customer education is also a must.
We have taken various measures, some of them being a multifold password measure, virtual keyboard and customer alerts. We have also implemented a risk engine that sits adjunct with our net engine and evaluates all transactions on Net banking. It stops certain kinds of transactions, and allows certain but also alerts the customers about those.
We have partnered with global solution providers who monitor things on the net, for example: IP addresses.
Has the current global economic scenario had any impact on the IT spend at HDFC?
We are growing at a healthy rate and our performance is also very consistent. As an IT strategy, we will continue to invest. We now have 1400 branches across India, and there are plans to open new branches. We will however, recalibrate our spend.
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