Financial institution ICICI Ltd is looking at acquiring or setting up portals on the Internet for developing its business.
The focus will be on customer share rather than market share, chief executive officer and managing director K V Kamath told Business Standard.
ICICI sees this as its strategy for the new millennium and it could change the manner in which banks do business.
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Its subsidiary ICICI Infotech is evaluating the two options for distribution of financial products.
ICICI set up an e-commerce division just four weeks back, which is interacting with a group of ICICI Infotech officials to develop and implement new products.
"The biggest challenge for banks is to create relationships and not just by selling products. A bank should be able to tap its loyal customer base and not only sell products to this base but build up a relationship with it. In the changing world, what matters is who has a greater customer share and not market share," Kamath said.
"This is where the Internet will come into play. Through a portal it is possible to capture enough information on a client to build up a relationship. Therefore, portals and banks will have to come together. If a portal has three million registered e-mail users or visitors to the site, just imagine the number of relationships that can be built up with prospective customers of a bank," Kamath said.
"Our strategy will be to either buy out or set up portals on our own and create sub-brands of our financial services products," he said.
"Too many branches will not drive business. It will have to be a blending of technology and the traditional brick-and-mortar structure," Kamath added.
He said banks could no longer just compete with other banks. Competition for banks could come from the likes of Disney, Coca-Cola and even telecom companies, all of which command a huge customer base with which a relationship has been built.
"Products are converging. Delivery channels, too, are converging. We are changing accordingly. But the change has to be fast. It's all about clicks and bricks now," Kamath said.
ICICI is also considering leveraging the data processing capabilities of ICICI Infotech, which is its technology hub taking care of data of 3 million people, to service MNCs and other corporates as well later. This is something which global giants like General Electric do in India, explained ICICI officials.
Kamath also hinted that the new environment may even lead to a change in the organisational structure with all products converging into a common distribution channel. "We have the ability to change organisational structures as and when the need arises and the staff accepts this. If need be we will change the structure again," he added.
ICICI will unveiling the first of its kind business-to-business E-commerce platform for 1,000 corporate clients on December 26. ICICI will be the first bank in India to introduce a business-to-business E-commerce model for about 1,000 corporate clients and their business partners and operate an entire payment gateway ,said Kamath.
E-Incenting ICICI
* ICICI Infotech is evaluating the possibility of either acquring or setting up portals for finacial products
* ICICI recently set up a division on e-commerce and is interacting with ICICI Infotech to develop and implement new products
* The data processing capabilities of ICICI Intotech may later be leveraged to serve multinationals and other corporates
* ICICI's organisational structure may be changed, with all products converging into a common distribution channel
* The company will unvell its business-to-business e-commerce plattom for 1,000 corporate clients on December 26 k of India (RBI) panel on restructuring of urban cooperative banks (UCBs) has recommended a minimum capital adequacy ratio (CAR) of 8 per cent by 2001 for scheduled urban cooperative banks.">