Banking in India has turned around in the last three to five years with private sector banks leading the revolution through new business methods. They are now taking the purchase process of a bank or a financial product to a level of ease and simplicity that one experiences while ordering a home delivery.

Banks are vying for the household market in terms of retail banking, personal financial services and payments. On offer are accounts, loans, deposits, mutual funds, credit cards and payment facility on electronic channels like mobile, Internet and ATMs. All services that are offered out of a branch are now available through a bank’s Internet banking site or its ATM. Coupled with 24-hour call centers, banks need now to formalize a unified view of their customers and manage their identities in a secure environment. This will be the basic building block on which a bank can strategize relationship management and create unique personalized selling engagement models through its touchpoint infrastructure.

Secure identity management (SIM) has two components:

n Identity management (IM) assigns user accounts and access privileges globally in an automated manner across multiple systems. It simplifies identity management, reduces administration costs and increases security by managing user identities through a single authoritative source.

n Access management (AM) creates a foundation for eBusiness enterprises by bringing together components that will allow customers to extend their business infrastructure and services beyond their firewall - without sacrificing security or admitting unauthorized users. With this, banks can simplify, secure and accelerate their transformation to eBusiness.

n It is very important to have directory services as the foundation for SIM, as it would act as a central repository for storing all relationships and policies. Since organizations have multiple heterogeneous systems, it is important to select a directory service that runs on heterogeneous environments.

An organization that wants to transition from a product-centric to customer-centric approach should first understand its customer base, the relationship a customer has with the bank and the customer’s relationship inside and outside his household. Once these are available on an IT infrastructure in a form and format that can be leveraged, the next step is manage their identities in a secure manner. Once this is accomplished, technology implementation of customer touchpoints, business intelligence systems, and back office and front office systems can tap into them to realize the bank’s strategy.

As shown below, the customer-integrated data forms the basic building block and the key to success for:

n Effective deployed channel infrastructure leverage that results in smaller RoI.
n Meaningful personalization of products and services to increase customer satisfaction.
n Meaningful cross-sell, up-sell and down-sell, thus expanding business and cutting costs.
n Value and meaning to central management of customer interaction across all channels, thereby reducing RoI on such infrastructure deployment.

Some of the ways banks can leverage the integrated customer data are:

n Leverage single customer interaction: When unified customer view and SIM are in place, technology infrastructure falls in place for providing a single sign-on facility to customers. Customers accessing services and product information using the bank’s touchpoints get authenticated by this information repository. As most electronic channels move towards talking open standard protocol like XML over HTTP, enterprise portals and web-enabled applications are ready for leveraging the touchpoints in a well-connected enterprise. Imagine a bank’s customer withdrawing cash from an ATM being informed by the ATM (while the processing takes place) that he has missed on a credit card payment or that his loan installment has been processed and dispatched.

n Exploit the customer’s household potential: Optimal leverage of a customer’s income is what banks strive for. In the absence of a single view of customers’ relationship across banking enterprises, banks tend to oversell to a customer’s household. That results in bad debts and high NPAs on the asset products and dwindling levels of money invested in liability products.

n Collaboration on infrastructure and touchpoint usage: Customer centric banks tend to provide similar look and feel and experience across all touchpoints. "Going ahead" banks will collaborate with other banks and third-party service providers and share each other’s connectivity infrastructure, touchpoint drivers and the touchpoints.

Solution steps
One of the basic requirements for a bank to leverage a unified customer view is the need to have a well connected and integrated IT environment. This pops up the classic question: Do I need to integrate my systems first or do I need to implement a unified customer view first? Each of these deployment projects has its own nuances and complexities that affect the elapse time for project completion.

A unified customer view deployment with SIM solution around it and the selection of the right technologies to deploy it will determine the basic hygiene factor of a bank. While the deployment of a unified view directly effects the bank’s bottomline by virtue of facilitating the growth of a healthy portfolio, the right technology choice will help the bank sustain and increase its growth in the times to come when market conditions force the banks to collaborate with other banking and non-banking organizations.

GN Nagaraj
vice-president (professional services)