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Showing posts with label IDFC. Show all posts
Showing posts with label IDFC. Show all posts

Thursday, 9 March 2017

13:51

IDFC Aadhaar Pay, the country’s first Aadhaar-linked cashless merchant solution

IDFC Aadhaar Pay, the country’s first Aadhaar-linked cashless merchant solution

IDFC Bank takes the lead, launches Aadhaar Pay

Dr Ajay Pandey, CEO,UIDAI, Dr. Rajiv Lall, Founder, MD & CEO, IDFC Bank, Amitabh Kant, CEO, NITI Aayog and Aruna Sundarajan, Secretary Electronics & IT (L to R ) during the launch of IDFC Aadhaar Pay , in New Delhi on Tuesday. - Photo by Kamal Narang | BusinessLine
IDFC Aadhaar Pay, the country’s first Aadhaar-linked cashless merchant solution, was officially launched on Tuesday, following successful pilots across 16 States.

Speaking at the launch event, Amitabh Kant, Chief Executive Officer, NITI Aayog, said IDFC Bank had set the trend and all other banks should now roll out a similar facility.

“You will not need micro-ATMs anymore in the country. Anybody with a mobile phone and small dongle can turn into a merchant for everyone else and start accepting payments,” he said.

Kant highlighted that the IDFC Aadhaar Pay was significant as it was not charging any merchant discount rate, which was a pain-point for merchants.

“IDFC Bank will have winner’s advantage. Other banks should follow IDFC in on-boarding merchants throughout the country. If they do not follow the lead that IDFC has set, technology will make them redundant,” Kant said.

He said the IDFC Aadhaar Pay launch was significant as it would “enable us to reach the bottom of the pyramid” where people do not have either GSM or mobile phone.

Given the slew of innovative measures taken in the last few months, India is poised to take a major leap towards financial inclusion and revolution in the coming days, Kant added.

Rajiv Lall, Founder Managing Director and CEO, IDFC Bank, said the launch (of IDFC Aadhaar Pay) was an important milestone in the journey to financial inclusion.

He pointed out that all the innovation that one had read about recently was focussed on that segment of population that had smart-phones. Only 350 million have smart-phones out of the total population have 1.2 billion. “The differentiating feature of the Aadhaar Pay technology that we are launching officially today is that it makes cashless transactions possible even to people who have no phones,” he said

Individuals with Aadhaar-seeded savings accounts in any bank can transact on IDFC Aadhaar Pay using fingerprint as digital identity to make cashless payments at merchant points.

Over the next 36 months, IDFC Bank will look to on-board as many as one lakh merchants across the country to its IDFC Aadhaar Pay solution, Lall said.

In the pilot phase spanning three months, over 1,500 merchants have enabled digital transactions for customers of all banks, using IDFC Aadhaar Pay on their smart-phones.

How it works?

IDFC Aadhaar Pay is an Aadhaar-linked interoperable banking software application developed by IDFC Bank. This app is made available on a merchant’s smart-phone. Customers can pay the merchant by selecting the bank’s name and filling only one field on the merchant’s phone — the Aadhaar number. The customer’s fingerprint is the password used to authenticate the transaction.

Customers need not use debit or credit cards, download mobile applications or even carry a mobile to make cashless transactions. This solution eliminates the hassles of remembering passwords, account numbers, setting up virtual payment addresses and using USSD codes to transfer money.

Aruna Sundararajan, Secretary, Ministry of Electronics & IT, lauded IDFC Bank for this pioneering initiative, stating that it signalled a paradigm change in the financial inclusion journey.

Describing the launch of IDFC Aadhaar Pay as “historic”, Sundararajan said this is equal liberation for the merchant. “We are truly hoping that hundreds of thousands of merchants will benefit and easily accept digital payments,” she added.

Srivats.Kr@thehindu.co.in

Source:BL



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Thursday, 3 November 2016

19:10

IDFC Bank using micro-ATMs to make inroads into un-banked areas

IDFC Bank using micro-ATMs to make inroads into un-banked areas

Versatile, handy and less expensive, these devices help the bank gain market share
MUMBAI, OCTOBER 31:  
As a recent entrant to the world of universal banking, IDFC Bank is trying to change the vocabulary that one associates with the physical reach of the banking industry.

Given the advantages that incumbent players have in terms of branch network, it knows that replicating that will take time and cost money. So, if it has to reach the top, IDFC Bank cannot get there by doing more of the same but has to find a new way to drive its costs lower while expanding its distribution and acquiring more customers.

Rajiv Lall, the bank’s founder MD and CEO, says that the bank’s customer acquisition and servicing strategy has to be branch agnostic. He says it is not the number of branches that matter but the points of presence that matter, and these can be anything — a kirana store with a micro-ATM, a business correspondent outlet or a branch.

Eventually, of course, these points of presence may not be necessary as customers become more sophisticated and connect digitally — through internet or an app on the smartphone. IDFC Bank knows that in rural areas, that would take a little longer. For now, the emphasis is on getting rural customers to come on board.

A key tool
The key tool in the IDFC Bank strategy to target lower-income customers in non-urban or rural areas is a small device — a micro-ATM.

At a glance, it looks like a large tablet. It has an attached biometric scanner and thermal printer and is Aadhaar-enabled and interoperable. It can do everything a regular ATM can — and more.

Using multiple identifiers — whether it is your mobile number, Aadhaar number, debit card number or bank account number, one can perform all basic banking transactions.

So, you can do an account opening, deposit cash into any bank account, withdraw money from your account, undertake balance enquiry, get your statements, make funds transfers, remittances, etc. And customers of other banks can also transact on these instruments.

Importantly, these micro-ATMs come at a fraction of the cost of regular ATMs — estimates put them at about one-tenth the cost. So, that would be ₹50,000-60,000 per micro-ATM.

These micro-ATMs are handy and can be placed anywhere — in every village with connectivity; perhaps at a grocer, a chemist or panchayat office — and, of course, they can easily be disconnected and taken home by business correspondents.

In rural areas, where going to an ATM after nightfall may be difficult, this facility is helping improve financial access significantly, IDFC Bank officials say.

“You don’t need to go 10 km to reach an ATM or a branch now. Many farmers are now able to withdraw their fertiliser subsidy through this facility,” a bank official said.

The bank is also actively using the micro-ATM model to enable all government payments and direct benefit transfers, including pensions and scholarships, through interoperable Aadhaar-enabled payment services (AEPS) in Krishna district of Andhra Pradesh.

The bank will soon implement this model for the public distribution system (PDS) in partnership with the AP government. This will make PDS payments cashless and help take digital banking to the next level in rural areas.

The bank has made significant strides in AEPS through mirco-ATMs and has been among the top two banks in this area during the first half of this fiscal.

Market share
Careful placement of these micro-ATMs (where there are no other ATMs or branches) and the interoperability feature — through which the device can be used either through a phone number, card or Aadhaar number — has helped the bank gain market share.

After its success in making a dent in un-banked areas, IDFC Bank is also deploying these devices in metros such as Delhi and Mumbai to facilitate remittance of money from labourers and daily wage earners to the hinterlands. The bank has deployed about 820 micro-ATMs so far. It plans to double this number in the next six months.

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Thursday, 31 March 2016

08:11

Bandhan and IDFC Bank's bumpy journey since getting banking licence

Bandhan and IDFC Bank's bumpy journey since getting banking licence

Most of those who scrambled for a banking licence — some to make a quick buck — should be a happy lot. For the two entities that succeeded in getting the coveted licence two years ago, the going since then has been tough. If banking is a cow then one had to transition from an ant and the other had to shrink from being an elephant, both difficult propositions.

In the US, setting up new banks was as easy as opening restaurants. The US market saw formation of more than 2,000 banks between 1990 and 2008, before strong regulations in the wake of the global financial crisis and the fall of banks like a pack of cards put the brakes on the trend. In the next five years, only seven new banks began their journey.

The scenario in the Indian market was vastly different, with just two banks — Kotak Mahindra Bank and YES Bank — forming in a decade. The country saw the entry of a mere 23 banks since the economic liberalisation in the early 1990s. This is now changing with Reserve Bank of India Governor Raghuram Rajan going for on-tap bank licences.

The free market strategy started off with the doling out of licences in April 2014 to two very different entities with contrasting backgrounds and cultures — Bandhan and IDFC. The journey since then has been nothing short of an Ayn Rand classic-like tale for them.

IDFC was essentially a lender to the infrastructure sector, while the licence to Bandhan was an experiment in which a microfinance company was preferred over large corporate houses such as Birlas and Ambanis with the regulator aiming to improve banking penetration in the hitherto untapped rural belt.

IDFC Bank, with a market cap of over Rs 16,000 crore, has navigated a host of issues in the last two years — from complex demerger of the business, setting up new technology, hiring designated senior-level management team to increasing the staff strength from a meagre 220 to over 2,350. The bank was up and running on October 1, 2015.

The structure the RBI asked IDFC Bank to set up was so complex that for assets and liabilities to move from the parent to the bank, they had to take approval from all its shareholders and creditors, including 15 lakh bond holders and over 400 institutional creditors.

"There were obviously nervous moments, but I never felt that we wouldn't be able to do it," Rajiv Lall, managing director, IDFC Bank, says. Few in the country barring Rana Kapoor of YES Bank has had the experience of creating a bank from scratch.
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Thursday, 17 December 2015

07:48

Intellect Design Arena offers technology to IDFC Bank

Intellect Design Arena offers technology to IDFC Bank

Intellect Design Arena Ltd, which offers digital technology for banking and insurance sector, has said the recently launched IDFC Bank, a subsidiary of infrastructure finance company IDFC Ltd, has implemented Intellect's Global Transaction Banking (iGTB) solution suite. 
The combined digital solution would help the bank, launched in October 2015, to introduce a differentiated form of banking. iGTB will offer full suite of solutions including payments, cash management, corporate banking exchange (CBX) and liquidity sweeps to the bank.
"Intellect will assist IDFC Bank in its digital journey by proving real-time, flexible, and automated banking processes to maximise operational efficiency and provide best-in-class customer service," said Manish Maakan, CEO, iGTB, Intellect Design Arena Ltd

 Source:BankingUpdates.
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Saturday, 12 December 2015

08:02

RBI lets IDFC Bank into Second Schedule list

RBI lets IDFC Bank into Second Schedule list

The Reserve Bank today said IDFC Bank Ltd has been included in the Second Schedule of the RBI Act.

"We advise that the IDFC Bank Limited has been included in the Second Schedule of the Reserve Bank of India Act, 1934," RBI said in a notification.

Earlier, in October this year, IDFC Bank started its formal banking services with a total of 23 branches across the country.

Of these, as many as 15 branches are in rural Madhya Pradesh.

The bank, with a focus on technology, has started operations in corporate and wholesale banking, rural banking and treasury verticals.

As part of personal banking, the bank is offering free transactions at any bank ATMs, free fund transfers, free debit card for lifetime and no charges for any transactions except when cheques bounce.

Last year, IDFC, along with micro-lender Bandhan Financial Services, was selected for a banking licence.

Bandhan started operations in August with a network of over 500 branches.

Source:BankingUpdates
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Tuesday, 8 December 2015

08:49

IDFC Bank Ties Up With TCS for Core Banking Solutions


IDFC Bank Ties Up With TCS for Core Banking Solutions

Mumbai: IDFC Bank has inked a pact with IT services major Tata Consultancy Services to use TCS BaNCS for its core banking solutions.

IDFC Bank started operations on October 1 this year with 23 branches, powered by TCS BaNCS.
The core banking solution equips IDFC Bank with a "flexible, easy-to-scale system that will help it deliver a differentiated customer experience", Tata Consultancy Services said in a statement.

TCS has deployed more than 300 similar projects worldwide.

In about nine months, IDFC Bank has implemented solutions for core banking, corporate loan origination, financial inclusion and Global Limits and Exposure Management (GLEM) from the TCS BaNCS suite and has integrated them with a host of additional systems within the bank.

It has started operations in rural banking, corporate and wholesale banking and treasury, in the first phase. It is expected to soon roll out personal and SME banking services.

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Sunday, 8 November 2015

14:52

Fact that public sector banks are going to be significantly capital-constrained in future -IDFC Bank Managing Director

Fact that public sector banks are going to be significantly capital-constrained in future -IDFC Bank Managing Director

IDFC Bank looks to cash in on capital-starved state-run banks

The newest private sector lender IDFC Bank hopes to fill the space being left by the inability of state-run banks to expand their balance sheet due to capital constraints, as it builds its retail franchise.

"The fact that public sector banks are going to be significantly capital-constrained in future, thanks to their legacy and asset problems, creates an opportunity for new private sector banks," IDFC Bank managing director and chief executive Rajiv Lall told PTI in an interview.

"So for us, starting from a small base but with strong capital, a strong management team and state-of-the-art technology, I believe it is very much possible to get a nice franchise over the next five years," Lall said.

Lall said the bank, which began operations on October 19 after getting an RBI licence in April 2014 by converting into a commercial bank from being an infra lender, will be focusing non-core income side to accrue capital which he hopes to pump back for rural play.

He noted that retail expansion, especially into rural areas, will take some time as it needs to shore up capital.

Lall also said out of the 23 branches opened so far, 15 are in rural areas of Madhya Pradesh.

"While we build on our existing historical strengths, we will be diversifying the revenue base from existing customers, and serve them much wider products, and build our non-interest income base.. these will be the engines that will drive IDFC Bank," Lall said.

He further said the bank will use the capital accrued from these verticals to drive rural expansion. "We will re-invest some profits generated from wholesale and commercial banking into building our rural franchise and a personal and business banking franchise," he added.

Lall said rural franchise is very important not only for meeting PSL targets but also for getting opportunity to build a profitable business in a segment that has not seen much competition.

Stating that personal and business banking will be a marathon, Lall said this stream of banking will be focused on top 50 centres as 80 per cent of corporate and household savings sit on these 50 centres.

The bank was listed on Friday at Rs 70.50 and closed at Rs 70.70 on the BSE. On this he said it shows that the market has understood the basis on which the demerger was undertaken.

On the asset quality, he said there is no worry on the bank as they have already provided for the next five year, going out of their way to clean up the book. 

"We've effectively taken very deep provisions against our legacy portfolio. Our belief is that for next four-five years we will not need to provide anything more against the legacy portfolio," he said.

On the just reforms in the power distribution arena, Lall said though the bank and its parent have no direct exposure to discoms, the bailout package will "help improve operations of discoms which in turn will help the power sector, where it has huge exposure, and therefore the reforms will help our portfolio."

He further said advantage of the reforms of discoms "could be that if these reforms take off we will be writing back some of the provisions we made as this will only strengthen our legacy portfolio and the ability to extract more value than we have provided."

On the proposed bankruptcy laws, he said the new legal provisions will hasten recovery related to asset quality problems. It will also help banks prepare for the next cycle (of bad assets) as and when that happens.

When asked about the performance of the bank since the launch, Lall said he is very pleased that their complex technology platform is working very well.

 Source:dnaindia
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Wednesday, 21 October 2015

08:26

Narendra Modi inaugurates IDFC Bank, talks of banking reforms

Narendra Modi inaugurates IDFC Bank, talks of banking reforms

Prime Minister Narendra Modi on Monday said the government has initiated a series of banking reforms including re-capitalisation of PSU banks, change in rules for hiring top management and paper-less transactions to curb the black money menace.

Modi said the entire banking sector is undergoing major transformation with the advent of latest technology. “The banking sector is seeing changes. Mobile banking is coming up. Banking will be premises-less and paper-less,” he said at the launch of IDFC Bank here in New Delhi. Modi further said India is slowly moving towards a scenario where the currency printing cost will come down.

“We have to take the country in that direction. As we use technology, we move to paper-less banking, currency-less business operations; the possibility of black money will gradually become negligible,” he said. He also stressed the need for banks to focus on rural areas as they have immense potential. The prime minister also listed out the seven-point agenda to improve operations of the state-owned banks. It includes capitalisation, setting up of Bank Board Bureau and introduction of a framework for accountability.

“We have decided to bring improvements in the appointments at the top levels of the banks. This improves efficiency,” he said, adding private sector professionals have been hired in PSU banks after nationalisation of banks in 1969. Modi said the government would be infusing Rs70,000 crore in the public sector banks in the next few years to help them deal with the distress assets issue. He also said import duties have been hiked on certain items to help the sectors facing problems and account for distress assets of the banking sector.

Talking about NPAs in the banking system, Modi said: “Bad loans in the past few years are a problem but we can’t only cry about it. We are trying to solve this problem.” Speaking on the occasion, finance minister Arun Jaitley said that Rs35,000 crore has been provided to 61 lakh applicants so far under the MUDRA scheme to help small entrepreneurs.
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08:20

RBI to provide more bank licences, says S S Mundra

RBI to provide more bank licences, says S S Mundra

Having allowed 23 new entities to enter the banking space, Reserve Bank of India (RBI) today said it plans to grant more licences to promote financial inclusion.

“You already have two new universal banks, you may have around 11 payment banks, you may have 10 small finance banks, and going forward, it can be a continuing activity where new players are released into the arena by Reserve Bank, if everything goes as per the planning,” RBI Deputy Governor S S Mundra said here.

“So there would be a large number of new players coming in. I think the key to financial inclusion is that all these players are taken into the national plan of financial inclusion in an orderly manner,” he said.

IDFC and Bandhan Financial Services emerged successful out of 25 contenders for universal bank licences issued by the RBI in April last year. These entities have already started their operations.

Besides, RBI has given in-principle nod to 10 entities to set up Small Finance Banks to provide basic banking services to small farmers and micro industries.

In August, the central bank had granted approval to 11 entities for launching Payments Banks.

To further the objective of financial inclusion, Mundra emphasised the need for structural reform in the agriculture sector.

“There are now limitation of credit absorption capacity of farm sector until and unless we bring in structural reforms in farming,” he said at an event organised by India Today Group.

Those structural reform would be in terms of more land under cultivation, pooling of land and advance area of farming, he said.

Mundra said there has been improvement in savings in the last few months.

“If there is persistent high inflation rate then the people would move towards other assets rather than financial savings,” he said.

On NPAs, he said it is localised phenomena and limited to few sectors.

 Source:BankingUpdates.
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Monday, 28 September 2015

07:52

IDFC Bank says considering using ATMs of other banks

IDFC Bank says considering using ATMs of other banks

Bank not to have own ATMs, offer free ATM transactions to users at other banks' outlets

As it prepares to launch its banking services, IDFC Bank is contemplating not having its own ATMs and making transactions at rivals' ATMs free for customers, a senior official said.

"We feel there is a saturation of ATMs in the market and even after having the machines, you spend on its maintenance. We are looking at not having a network of ATMs," its head of personal and business banking Naval Bir Kumar told PTI after the bank unveiled its logo last week.

He added that IDFC Bank customers may be allowed to use existing automated teller machines (ATMs) without any charges.

Kumar explained that the money a bank pays for installing and maintaining the ATMs from third parties works out almost the same as the commission or fees paid to other banks for a transaction.

He, however, added that no final decision has been taken on the matter as yet.

IDFC Bank is aiming to start personal banking operations by January.

At present, all the banks have invested in their own ATM networks and customers are charged for transacting at other lenders' ATMs after breaching a fixed number of free transactions a month.

Generally, a bank pays under Rs 20 to another bank for helping its customer carry out a transaction, but Kumar said it can be negotiated down.

RBI has allowed operations of white-label ATMs, which are being run by non-banking entities, with an eye on generating fees.

At the event, its executive vice chairman and managing director Rajiv Lall had said the bank does not plan to offer higher rate of interest on saving deposits, as is being done by others like Kotak Mahindra Bank or Yes Bank.

It is formally launching services on October 1 with 23 branches, out of which 15 will be in rural areas, Lall had said.

By end of the year, it is planning to take the total branch network up to 60, with 40 in rural areas.

Kumar said the component of rural branches, being called 'Bharat Bank' at IDFC, will be higher than the regulatory prescription of 25% for the initial 12 to 18 months and will be gradually increased.
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Friday, 25 September 2015

09:20

IDFC Bank targets 15 million customers in five years

IDFC Bank targets 15 million customers in five years

New private sector lender IDFC Bank will flag off its operations on October 1, with 23 branches for corporate and rural customers. Starting with a predominant share of corporate banking business, IDFC's banking subsidiary expects to grow the business of Bharat banking, a rural banking unit, to Rs 15,000 crore in five years.

Its personal and business banking unit focusing on retail, small and medium enterprises (SMEs) and self-employed professionals, will start operations, in January 2016. Rajiv Lall, the bank's executive vice-chairman and managing director, said the aim is to grow the client base from the current 400 corporate customers to 15 million in the next five years, a bulk of whom will come from business and personal banking and Bharat banking. Bandhan Bank, which got a banking licence around the same time as IDFC, started operations in August.

IDFC Bank is aiming at 10-15 per cent net profit growth and will rely on technology for customer acquisition rather than open branches across India. IDFC Ltd posted a net profit of Rs 240.88 crore for the June quarter this year.

Lall said the economy was coming out of a very difficult period after the global financial crisis and amid stress on bank balance sheets. Over the last year, the economic environment in India has seen steady improvement and the bank would like to gain from this momentum.

The bank will have a balance sheet of Rs 75,000-80,000 crore initially. Out of this the loan book, mostly infrastructure advances, will be in the region of Rs 55,000 crore and the balance will comprise bonds, corporate bonds and investments. It will be compliant with the statutory liquidity ratio and cash reserve ratio norms from day one, he added.

Commercial and wholesale banking, headed by Ajay Mahajan, will have an overbearing share in the loan book as well as bottom-line contribution. "We were offering term loans till date as infra lender. Now as a bank, we will be in position to give working capital, guarantees and letters of credit. Five years down the line, the bank expects the corporate segment to have two-thirds share in the loan book," Lall said.

The business will have three clusters - corporate, treasury services and government business. It expects the government business to ensure a steady flow of fee income and float money.

Bharat banking, backed by strong technology as well as brick and mortar banking, will start with 15 branches in Madhya Pradesh. Though this is a thrust area, its share in loan book is expected to be small. The emphasis would be on reaching the maximum number of customers with less investment on physical infrastructure.

Personal and business banking will be the last to start operations as the bank will first like to fine-tune its technical and service backbone. This business will start from January 2016 and would aggressively reach out to self-employed middle class professionals like architects, wedding planners and caterers. They generally create the maximum job opportunities, Lall said.

Lall said feedback surveys done by the bank in the run-up to the launch showed "no one likes bankers as there is a widespread perception that bankers are product pushers and less of solution providers". This is where IDFC Bank will like to stand out in services and offering, Lall said.

 Source :Business Standard.
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Thursday, 24 September 2015

07:38

IDFC to unveil brand logo of new bank on Sept 24

IDFC to unveil brand logo of new bank on Sept 24

Infrastructure Development Finance Company (IDFC) will be unveiling brand logo of the new bank on September 24.

The IDFC Bank will be beginning operations from 1st October onwards.

It had already begun a pilot in July in Madhya Pradesh.

These pilot were run in 10 branches of IDFC that are later going to get converted into the bank branches.

Recently, the IDFC got regulatory approval to utilise Rs 2,500 crore non-distributable reserves for provisions against bad loans.
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