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October 15, 2014

IT Solutions Moving Forward

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 8:23 AM

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IT vendors assisting banks in front- and back end processes and accounting either through a branch- or centralized core database developed several software solutions. They also built compliant solutions enabling banks to follow regulations and processes, reduce manual labor, errors and omissions and increase automation. These solutions were mostly utilized for streamlining operations and improving customer service. This set of solutions may be treated as first generation IT in the banking and financial sector.

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August 27, 2014

Make Business, Not Engineering

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 10:24 AM

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Most Indian IT companies have strategized, developed, branded, sold, implemented and established products & solutions catering to various industries and used by clients all over the world. Given the strength of Indian engineering skills, and good career options in that area, the Indian IT industry's commitment to exploring and building products is not surprising.  While a few products go on to attain maturity and leadership, many others struggle to gain acceptance. The Banking and Financial sector is full of complex IT solutions for core banking, insurance, Asset Liability Management, prevention of money laundering, etc. Such products and solutions must be easily deployable, and have the right features meeting the needs of the target market.

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July 7, 2014

Prequalification and Prioritization of Opportunities

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 9:48 AM

Software vendors participate in multiple bids across the globe. Though each vendor has a set of presales processes spanning activities in the bidding lifecycle from end to end, they occasionally deviate from them for a variety of reasons ranging from tight deadlines to lack of skills.  However most of the global vendors follow the basic processes, ensuring compliance with eligibility conditions and stipulated timelines. There may be a few cases where the submitted proposals are not of the required standards and are likely to be rejected.

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June 25, 2014

Process Integration and Customer Service Synchronization in the Services Industry

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 9:35 AM

Most services organizations follow different processes spanning activities that run from end to end of the lifecycle of their business operations. Processes, such as those in customer services, are common across industries. 

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June 16, 2014

What goes into Winning Bids?

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 11:41 AM

The software companies invest time and effort in bid management process for submission of multiple bids as part of various pursuits. The bids which are submitted include solutions for products, services, application development and maintenance, infrastructure etc. The value of bids submitted is taken as an indication of potential/future business for the vendor. The field force of IT companies sources these opportunities through direct relationship with clients /consultants or engages with local partners in specific markets for procuring the RFP. The global analyst rating and credentials of IT vendor which are known to external world also ensure that some of the opportunities comes by default to the vendor.

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How well is the IT industry aligning with the latest banking trends?

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 11:33 AM

When compared to the last decade, when the IT industry provided software solutions meeting comprehensive banking needs, the trend in the current decade may be seen as a reversal. The core banking solution (CBS) with a centralized platform, along with channels built around the solution, just about met banks' requirements in the last decade. Though there were functionality and technology gaps in the solution, most clients and banks accommodated them as something that would only come into the picture in the future and made do with work around approaches or manual processes. A few banks built the missing functionality through customization or procured a lighter peripheral or specialized solution from the market. However, a CBS with multiple modules and solutions with rich functionality helped banks to improve business in that era.

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May 29, 2014

Unified View and Dashboard Through Internet Banking

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 7:50 AM

As banks are increasingly moving towards specialized solutions to meet complex client needs, there is a need to redesign the channel solutions/architecture. Many IT vendors envisaged this change and are building solutions for the future in the form of a comprehensive channel platform offering.

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April 30, 2014

Specialized Solutions versus Core Banking Solutions

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 6:34 AM

When banks across the globe are investing in specialized solutions for Front End Teller, Loans, Deposits, General Ledger, Payments, Cash Management, Trade Finance, Private Banking, Customer Data Management and so on, the role of the Core Banking Solution (CBS) needs to be reassessed. Initially,  the core banking solution was0020designed as an integrated solution providing a comprehensive functional offering in all areas of different lines of business, with transaction processing and accounting capability. The legacy software solutions used in banks developed by local vendors presented architectural, technical and functional constraints in scalability and performance, creating a demand for core banking solutions. Also, the maintenance and support of multiple solutions and vendors was a major issue for clients globally, making a core banking solution with integrated offerings the preferred choice.

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April 29, 2014

Functionality versus Process versus UI versus Regulation

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 7:27 AM

The core banking solution was designed initially to centralize accounting in banks and enable their customers to transact from any of the branches or channels connected to the central database. Functionality and processes were built into the core banking solution, based on the software's country of origin. The primary design was based on the knowledge of local banking/domain experts in the product company. Though the solution catered to most banking needs of a particular country or region, in certain markets, it faced fitment challenges both on functionality and process compliance. Variations in the account opening, customer creation or loan approval process in different markets often required subtle or even major changes in the software solution. Customization was required to achieve process automation to meet market requirements.

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March 29, 2014

Dashboards and Analytics Overload in CBS?

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 1:02 PM

Banking has evolved from maintaining manual ledgers for accounting and book keeping to deploying core banking solutions for maintenance of customer data and products, as well as accounting across branches. Critical activities, including top management and regulatory compliance reporting, which were processed manually moved to multiple on-demand/ batch reports accessible to top management at any point of time. With MIS (Management Information System) and reporting tools available through software solutions, it became possible to analyze data at the central office easily and quickly. The information could be used for monitoring business at remote branches, conducting business reviews, formulating strategy and recasting and planning for the future, which was previously done at defined intervals.  Regulatory reporting could be completed as per periodicity of demand, without delay.

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March 24, 2014

How different is selling an FMCG product to selling a banking product or software solution?

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 6:37 AM

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In the early 2000s, when Indian banks hired field staff with FMCG (Fast Moving Consumer Goods) experience to sell banking products, there was a huge uproar in the community. There was a belief that only experienced bank staff could sell banking products to new consumers. Even cross selling a new concept or banking product to an existing customer, required banking expertise, persuasion and marketing skills. It was perceived that since the educated urban customer was aware of the nuances of conventional banking products offered by most banks, as well as their advantages and disadvantages, a novice would not be as effective in selling those products as an experienced bank hand. Pundits proclaimed that getting new sales staff to push banking products, which were becoming increasingly complex, would not work.

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August 30, 2013

Presales Scoping of Core Banking Software Projects

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 5:03 AM

Before a core banking project gets underway, it is vital to gather relevant information in order to achieve the desired end result. This "scoping" of requirement as part of presales is critical for successful implementation of a project. In a core banking context, project scope includes the identification of modular components like Trade Finance, Corporate Loans and so on, as well as optional features. Certain solutions, such as AML and Basel II/III are mandatory across banks worldwide regardless of whether or not they are explicitly mentioned in the requirement list.

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July 10, 2013

Scoping of Software Projects

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 6:05 AM

Core banking transformation is a mammoth task involving huge investment, planning and strategizing. On procuring budgetary approval for the project, the next step would be to identify and engage an external consultant to aid the bank in the evaluation process. Having understood the bank's business strategy and requirements, the consultant then converts them into a formal Request for Proposal (RFP) covering functional, technical and implementation aspects. It is crucial for the bank's project management team, comprising its business heads, to engage in continual dialogue with the consultant to ensure that all facets are adequately covered in this document.

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July 5, 2013

Rationalized Software Cost

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 11:25 AM

Banks investing in core banking software have to be cognizant of the various costs involved in procuring and implementing the same, such as:

a) Licensing
b) Implementation
c) Maintenance and Support

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May 29, 2013

Sure Prevention is Better than Cure

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 1:22 PM

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Ill-gotten money often gets circulated in ways that obscure its true source. The effort that goes into ensuring this is referred to as "money laundering." There are measures in place that aim to prevent such spurious activities, risk-based anti-money laundering software being one of them. However, its efficacy and that of other internal bank processes and regulations in preventing frauds is worth scrutinizing. 

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April 25, 2013

Future-proof Banking Solutions

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 9:21 AM

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Industry requirements often outpace technology solutions and there is a continuing need to plug this gap. This is especially true of the banking sector. Software companies have to be somewhat intuitive in terms of product design and development, in order to cater to the emerging trends and to stay in line with market dynamics.

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March 29, 2013

Safe Deposit Lockers - Are spruced up rules the answer?

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 5:26 AM

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Both Public and Private Sector Banks have offered Safe Deposit Lockers (SDL) as a service since long, usually to privileged customers. The locker - useful for storing valuables like gold ornaments or important papers - can be operated by the customer as and when required using the keys provided by the bank.

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March 14, 2013

People and Processes: Banking Twins

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 5:42 AM

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The idea of a world ruled by machines has inspired many a work of science fiction. That's just one manifestation of man's machine fascination. Another - which is both more real and meaningful - is the increasing device dependence of each generation. The advent of computers has further accelerated this process and it is, today, impossible to think of a sector or industry or facet of life untouched by technology. The banking sector, in particular, has been a major benefactor of technological advances. What remains to be seen is whether this trend will make people redundant in this sector.

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February 26, 2013

Prevention of bypass surgery or heart attacks for core banking

Posted by Reghunathan Sukumara Pillai (View Profile | View All Posts) at 5:42 AM

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Core banking systems were originally envisaged with the singular aim of maintaining customer account data in a centralized system accessible across the bank's network of branches. Account aggregation into assets and liabilities for general ledger consolidation was inherent in the core. To ably assist front office operations, the system comprised simple processes. Higher value transactions were often routed through multiple approval levels within the core, with a defined workflow.

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