Bank puts all 13,000 branches on core banking platform.
High net worth customers walking into a State Bank of India branch could soon be greeted by name as soon as they reach the counters. That’s because scanners at the doorstep will detect an RFID chip embedded in their debit cards and flash an alert on the bank’s computers.
A senior SBI official said this will happen in the “near future”, and is a part of the country’s largest and oldest bank’s drive to use technology to take the concept of a ‘friendly bank’ a notch higher.
Also in attendance will be industry leaders like Mukesh Ambani, TCS Vice-chairman S Ramadorai, and Bharati Group Chairman Sunil Mittal. Economist Jeffery Sachs and Cisco CEO John Chambers will speak on a video link.
In a span of nine years (2000-09), SBI has managed to roll out core banking systems (CBS) to all its 13,000 branches, making it one of the largest banks in Asia to have a single CBS platform. It has also connected close to 3,000 ATMs to a centralised network.
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While there are many banks that have centralised CBS and a fully-networked ATM system in place, what differentiates SBI is the sheer size. Consider this: SBI alone has 170 to 180 million accounts and its subsidiaries have another 80 million or so. The average daily transactions handled by the IT system are about 25 million. And peak-time transactions (generally in March) go up by 10 - 15 per cent.
SBI Chairman O P Bhatt said technology has played a big role in giving SBI the edge it enjoys today. The implementation has happened in a phased manner, but any new branch is on CBS now from the very first day. The second part of the exercise was to connect the ATMs. Over the last nine months, SBI has added 1,000 ATMs per month, the largest such rollout in the world.
To mitigate the risk, SBI has set up a disaster recovery site in another state. And not to be caught unawares, it conducts disaster recovery testing at regular intervals.
SBI recently signed an eight-year contract with IBM for data mining and warehousing. “This will allow us to get qualitative information about customers. That in turn will help our employees to make informed decision. This is still at a preliminary stage. The real benefit of this will take a few more years but in the next few months we will start extracting monthly information reports. We are investing about Rs 80 - 90 crore for this system,” added SBI Deputy Managing Director (IT) Krishna Kumar.
The process for this mammoth implementation started in 2000 after SBI developed a technology roadmap along with KPMG. The need to deploy technology arose after private banks had started eating into the market share of state-owned banks. SBI too was not immune to this.
The problem at SBI was that while the bank had automated all its branches, none of these was able to talk to others. This meant that the bank did not have a single view of its customers’ information and could not do any significant strategic planning.