i-flex inks software deal with HSBC

As banks move from a loans-and-deposits model to 'financial super-markets', the Rs 1,500 crore banking solutions company, i-flex solutions, has bagged its first big customer for its distribution-business software for banks.

The company today announced the licensing of its mutual fund distribution software, the first of a planned series, to the multinational HSBC for six countries in Asia.

According to market estimates, the deal is likely to be worth between Rs 25 to 100 crore in the first year, depending largely on the extent of deployment.

"Till now, we have been supplying core banking solutions, like retail loans etc..., but with this, we are exploring the new market of the non-loan, distribution-based services of banks, like mutual funds," said Deepak Ghaisas, CEO of India operations.

HSBC is the first of the company's big clients for its product distribution software, which also distributes asset-related information, such as net-asset-value of a policy, to customers. Ghaisas said the company is working on tapping markets for distributing other similar products, like insurance policies.

"We had brought out the first version of this software six years ago, but it was mainly for single-location installation," he pointed out.

For the last financial year, nearly 54 per cent of the company's revenues were product or license-related. For its loan-related solutions, the company counts most of the leading banks in Europe, as well as the US-based Citigroup among its customers.

"HSBC has nearly 5 per cent of market-share in distribution of mutual funds world-wide. In six countries our software will replace the company's proprietary software.

Though these six countries do not contribute even half of their total business, we expect more and more branches to switch over to our solution as the advantages become obvious," the CEO said.

"We will also be tapping our existing clients for our core-banking solutions to extend the reach of such products," he added.