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Driving Inclusive Growth

through Mobility

Aniruddha Paul

CIO, ING Vysya Bank

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Guideline

www.ing-presentations.intranet The Importance of Being Ranjana Sonawane

Who: UIDAI Unique Identification Authority of India

What:

(1) Assign a UID to all 1.2 billion Indians;

(2) Provide online biometric based authentication services

Numbers:

(1) Database > 6 peta bytes (6000 terabytes)

(2) > 1 billion addresses

(3) > 1 million auth requests/day

(4) 500 million UIDAI numbers already issued

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Guideline

www.ing-presentations.intranet There is a Fortune at the Bottom of the Pyramid – Unlocking the Fortune Requires Mobility

Need for unique ID

To provide accessible

identification that can be used for

entitlement (unique and universal)

Master Data

Management

Enable service and applications

that require a verifiable unique ID (continuity and

mobility)

Data Mining

Real Time Analytics

Business

Intelligence

Prevent duplication of effort

and leakages existent in the current system

Data De-duplication

Data Quality

IBM Worklight & ING

Vysya Bank can

leverage the UIDAI

platform towards

Financial Inclusion and

Social Change through

appropriate banking

apps and services

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Guideline

www.ing-presentations.intranet Retail Banking: What’s been good for Indian banks hasn’t been good enough for the country

• Scorching pace of growth since liberalization: CAGR of around 30% to touch a figure of INR 9700 Billion. Bankable households are growing at a CAGR of 28% (2007-11)

• But the growth has been lopsided

• Retail loans constitute 7% of our economy versus 35% in other Asian countries

• Retail assets are at only 25% of total banking assets

• 41% of India’s adult population is un-banked

• Number of loan accounts: 14% of adult population

• 73% of farm households have no access to institutional credit

• Share of money lenders in rural debt has moved from 17% in 1991 to 30% in 2002

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www.ing-presentations.intranet This imbalance is caused by banks chasing the low hanging fruit that constitutes the urban savvy consumer

• Purely from a profitability perspective, a large portion of the

Indian population is perceived to be “unbankable”

• The costs of servicing the remote rural sector using traditional

business models (KYC; branch centric model; incremental cost

of infrastructure) makes profitable banking unviable

• Therefore, all banks tend to target the upwardly mobile urban

salaried class

• Banks are even creating “financial exclusion” barriers

by increasing minimum balance requirements and average

deposit sizes

• Technology has lowered the cost of servicing this

target segment

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www.ing-presentations.intranet Fortunately, The Scenario is Changing

• Financial Inclusion (FI) is an RBI mandate, government mandate

and a social mandate

• There IS a fortune at the base of the pyramid

• Social security payments and NREGA payments (> USD 100 billion) are

being routed through banks

• MFI’s have shown that it’s possible to run extremely profitable businesses.

Most major banks are working on a business-driven FI strategy

• Simplified KYC norms (e-KYC) and UID is expected to drive down

the cost and time of customer acquisition and servicing

• Innovation in mobile / hand held devices using an uniquely Indian

model offers the best potential breakout strategy. IBM Worklight with

its flexible, open architecture and easy integration will be a key

enabler of our initiatives

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Guideline

www.ing-presentations.intranet

“ Today, if you look at financial systems around the globe, more than half the population of the world –

out of six billion people, more than three billion – do not qualify to take out a loan from a bank.

This is a shame… The poor themselves can create a poverty-free world... all we have to do is to free them

from the chains that we have put around them”

- Muhammad Yunus

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Thank You