'Our focus is on affordable banking'

BANKER SPEAK

, the head of retail banking at Barclays Bank India said the next quarter will be crucial for the bank. In the next three to five months, there will be a series of new business launches. Barclays is rolling out its retail business in a gradual manner as it has a very high downside. Excerpts:

Were you late in entering the retail banking market in India?

Barclays took time to come to India with retail banking products. However, the timing is right. India is expected to see phenomenal growth in the next five years. India is high up on the chart in terms of Barclays Bank's commitment and sharing of best practices.

When a bank starts from scratch, it is at an advantage since it does not have any legacy systems. Retail is all about technology. We have a retail staff strength of around 700, assisted by the feet on street. The bank has a lot of exciting plans. Give us another two to three months and you will keep hearing from us. We launched the personal loan and cards business in May and the non resident Indian (NRI) business in June.

We have also rolled out premier investment services for customers. Now we need some breather to see if everything is going well. The next quarter is crucial for us. Good times are ahead. India is the best place to be at this point in time.

Can you give us an overview of your retail business? What has your strategy been and how is the going so far?

We are focusing on how to make banking affordable for the customer. The bank is bullish on retail business. Personal loans and business loans for small and medium enterprises have been a big focus for us globally. Accordingly we have launched these products in India as well. Barclays operates through four branches and is expecting some more branch licenses. The bank has a credit card base of around 1,50,000.

Our credit cards allow the customer to choose the minimum amount that he wants to pay, irrespective of the spends and billing cycle. We are very active in the personal loan business. Considering the existing branch restrictions on foreign banks, we are exploring alternative models. The Indian customer is ready for branchless banking, as was revealed in a recent survey conducted by the bank.

Bank customers are comfortable using alternate channels such as ATMs, mobile and internet. Additionally, the Reserve Bank of India (RBI) has also permitted doorstep banking and the business correspondent model should help the bank in its microfinance business. Our call centre has also gone live. We are putting the basics in place, as it is clear that customers don't need branches to bank.

Are you exploring alliances with existing players to boost your reach?

We have correspondent bank relations with HDFC Bank and Centurion Bank of Punjab. We are not in talks with any banks. However, Indian banks are looking to forge alliances with us to offer their products and services overseas, particularly in the United Kingdom.

What role will Rank Investments play in your retail strategy?

The NBFC (acquired recently by Barclays) is a separate entity. We are currently focusing on building the bank. It's too premature to talk on the NBFC. The country strategy is led through the branch banking route.

There have been signs of banks helping customers to over-leverage themselves, which in turn is leading to higher defaults. As a new entrant, what kind of checks and balances do you have in place to ensure a quality portfolio?

For all our customers, we rely largely on the credit bureau. We have prescribed internal guidelines to decide on a customer's debt burden ratio. We also lend rationally. Additionally, given the kind of regulations, we have a policy on treating customers fairly.