Next Gen BankingHow Regulation and Technology is changing Banking in India

Ashish Banerjee, Technology Evangelist@innomon

Agenda

New Banking Licenses

Technology Levers

What has Changed

New Opportunities

Why So Many Licenses?

New LicensesWhy so many types of

Banks?

PPI (Prepaid Payment Instrument)

Payment Banks

Small Finance Bank

Scheduled Banks

What is Money

Money is a device for storing and exchange

economic value.

Storage of Value requires Security and Stability

Exchange of Value requires Agility and Innovation

StabilityStable organizations are required for Security and Stability needed

for Storage of Economic Value functionality of Money.

AgilityTransfer of Value functionality of Money need Agile & Innovative

organizations for high velocity , low value money transfer.

Different Licenses for Agility and Stability

Transfer of Value: Agility and Innovations :

PPI (Pre Paid Instruments)

Payments Banks

Storage of Value: Stability and Security

Small Finance Banks

Focus on rural and unbanked population

Loans to small entrepreneurs and Self Help Groups

Scheduled Banks

Too Big to Fail

Focus on conventional banking

Backbone Support for security and stability for PPI and Payments Banks

RBI recognised that it is difficult for one organization to pursue the divergent requirements for Transfer of Value and Storage of Value functions of Money

What Has Changed?

100 = 10Accounts opened in last 100 years equals the number of accounts

opened in last 10 years

For Bottom of Pyramid customers new Low Cost Innovations required for High Velocity low value transactions

Urban PPI and Scheduled Banks will mainly focus on Urban population and

top of pyramid customers

UnbankedPayments Banks and Small Finance Banks will focus on unbanked and

rural customers

New Opportunities

UrbanPPI and Scheduled Banks

Social Media is the new banking channel

Mobile Banking Apps new differentiators

Technology enabled Doorstep Banking

Payments Innovations

Mobile commerce integration

IMPS (Immediate Payment System)

SocialSocial Media is the new

channel

TwitterHashtag banking: Kotak

Money Transfer: HDFC

CRM integration: most banks

DM OTP

FacebookCollaborative Saving: ICICI iWish

CRM integration: most banks

OAUTH Social Login

DM OTP

DoorstepYour Home is our branch

Mobile POS:E-commerce and Local

Commerce

Doorstep Full ServiceCash Delivered at Home

Tablet based branch bank at home

Instant KYC

Instant pre-activated account opening

PaymentsInnovations and Agility

NFC POS

Payment TokenizationNPCI UPI (Unified Payments

Interface)

Universal Payments Wallet

Social Payments and Split Pay

IMPS Mobile Immediate Payment

system

AEPSAadhaar Enabled Payment

System

QR Code Local Commerce

UnbankedLow Cost Innovations

BC (Business Correspondent)Tablet App with Offline first

embedded biometrics

Universal Banking App

Financial Delivery Platform for Value Added Services, like, Railway Tickets, Micro Insurance, assisted e-commerce

AEPS: Direct Subsidy Transfer

Human ATM and Micro ATM

Instant Inward remittance

Feedback Welcome at Twitter:@Innomon