Several small commercial banks in the private sector have been taking extensive recourse to technology and have come out with excellent results.
The 102-year old Karur Vysya Bank (KVB) is a good example. Managing Director & CEO, P R Seshadri, announcing the results of the bank for 2017-18, explained the transformation from the age of the paper to the digital. He referred to the work at the KVB Digital Centre of Excellence. The KVB-Next, the first such facility in the Indian banking sector, uses the digital platform for processing retail and business loans, assuring in-principle sanction in 15 minutes.
KVB saw the opportunity to deliver financial services at the doorsteps of customers using the rapidly evolving digital structure. The bank launched the KVB-Next with digital versions of home loans, personal loans, loans against property, working capital… The bank promises to process the application through digital mode in less than 15 minutes and process disbursements within a couple of days. The process is simple, automated, paperless and user-friendly, assured Seshadri. The process can be completed in the comforting confines of the customer at his/her home/office. A self-service web portal will help complete the loan application process.
Seshadri also referred to the KVB-DLite, an all-in-one mobile banking app through which a new customer to the bank can open a savings account.
Performance through 2017-18 had several highlights. For the first time, total business of the bank crossed Rs 100,000 crore with deposits of Rs 56,890 crore and advances of Rs 45,973 crore. Capital funds recorded a handsome increase to Rs 6212 crore. Capital Adequacy Ratio was at a healthy 14.43 per cent.
However, net profit declined to Rs 345.67 crore (from Rs 605.98 crore for the previous year) and net NPA increased to 4.16 per cent (from 2.53 per cent).
KVB has a pan-India presence with 788 branches, 1803 ATMs and 538 cash deposit machines. With the present switch to digital banking, the focus on brick and mortar expansion will wane.