BFSI VISION Branch Transformation


Ashwini Tewari

General Manager (IBG) ,
State Bank of India

Alternate Channels the major drivers for business and customer engagement

Business Drivers for Branch Transformation
The nature of business and the terms of engagement of the customers with the banks have changed dramatically in the last five years. The major drivers collectively may be called 'Alternate Channels'. These currently include ATMs, Internet Banking, Contact Centre, Phone Banking, Mobile Banking and Social Media Banking. The last two channels have become important in the last two years and mirror the way in which technology in communications is being consumed by customers. The basic vanilla banking services which have shifted to such channels include cash withdrawal and deposit (ATMs, Cash Deposit Machines), funds transfer (INB, Mobile, ATMs) and transaction and product enquiry (INB, Mobile, Call Centre, ATMs). The business case for branch transformation, therefore, rests on customer convenience, cost savings, technology upgradation and need to decongest the branches. This migration to Alternate Channels, which is as high as 70%, and more in case of few private sector banks in India, has led to a reassessment of the role of branches necessitating transformation.

The look of transformed branches and applications that will be accepted by the customers
We have to accept that even with the plethora of alternate channels available, Brick and Mortar branches, particularly in a country like India, will continue to be needed. The major shift in transformation will happen towards advisory services and loan delivery. Most customers – when they want to acquire a house, a car or invest in a financial product – prefer face-to-face interaction. While for HNIs and others, this may be done by dedicated Relationship Managers visiting their houses / offices, there is a large mass affluent segment which needs to visit the branches to discuss these matters. Most branches thus needs to have an outer area, where ATMs / CDMs / Cheque Deposit Machines / Phone Banking / Drop boxes are located, and an inner lean area where Loan Marketing / Advisory, Account Opening, Cross-selling Wings, etc. will be located.

Nudging customers towards these applications
The way to nudge the customers towards the applications mentioned above in a transformed branch would be deeper engagement. The first level engagement should be to familiarize the customers and help them with fully adopting the alternate channels available and then guide them to the services available in the branch. Here a concept pioneered by SBI could be found useful. SBI has, as part of BPR strategy, upgraded its Help Counters to 'Grahak Mitras'. These are clerical staff whose role is to guide the customers to migrate to alternate channels, the correct desk for transactions and, in general, make the customers feel welcomed in SBI branches which have been redesigned. In the branches where Grahak Mitras are active, adoption of alternate channels has been high and customers, in general, have been happier, which incidentally is the bottom line for everything – transformation or otherwise.