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Core Banking Solutions India

Digital Payments: Here’s everything Banks must know!

2016 – A year that has engraved its name in the history of Indian Economy for note bandi, will be remembered for withdrawing ₹ 500 and ₹ 1000 currency notes. These currencies that constituted 86% of the total value were eliminated overnight on November 8, 2016 when PM Narendra Modi announced the digital and cashless India initiative.

As a result, cashless payments by the end of 2016 increased in tenfold. Indians, particularly from the urban lands, have been adopting various digital payment modes past demonetisation. While online banking and mobile banking have popularised, we also witness non-banking companies offering digital wallets like PayTM, Freecharge, and MobiKwik etc. hitting the opportunity.

digital-payment-methods
Image Source – Trendhunter

With latest technologies available in the market, banks can themselves offer their customers a wide range of cashless banking solutions that are faster and safer. Check out these major reasons why banks need to have their own digital payment methods…

  1. No rural areas should be deprived of the cashless means

In an effort to become a cashless economy, the masses in rural India are often left back. Each day digital India movement is progressing, however, a maximum population still remains far from internet technology and smartphones. While PayTM and the like target urban population who is smartphone-friendly and internet-savvy, banks do bear a larger responsibility to reach-out to those in the not-so-developed areas.

Banks can help both the rural and urban people still go cashless when they don’t have access to internet and smartphones. Cashless banking solutions that work not only through scanning QR codes or online money transfer, but through SMS – this is how banks can empower their valued customers.

Here’s an inspiring video of how Thenhipalam Rural Co-operative Bank of Kerala helped customers and local vendors go cashless after demonetisation through COOPaisa – a one-of-a-kind app to buy, sell and exchange currency with or without smartphones and internet.

  1. No third parties involved

 All digital wallets and payment banks today work on the concept where users load their wallets using their Bank Accounts (i.e. through internet banking, mobile banking and credit/debit cards). This means, the user blocks a certain amount in these wallets and uses this amount only at places where it is eligible. In case the amount is insufficient to carry forward the transaction, the user has to reload his/her wallet. On the other hand if transactions aren’t carried out through the wallet, the amount lies unused, which otherwise could have been availed elsewhere.

Banks, when having their own digital payment modes, can serve their customers better. They eliminate the need to load wallets in third-party applications, saves blocking of money and offers convenience along with security to customers.

no-third-parties-involved
Image Source – Outlook India

Many of the Indian Banks are already using Core Banking Solutions in an effort to simplify their processes, maximize efficiency and ultimately delight the customers. Yet, empowering customers with seamless banking solutions in today’s dynamic payments landscape is also crucial. The rising trend in the global payments industry is indicative that the banks must continually provide new innovations to match up with the changing mandates and regulations in banking sector.

E-village – a premium offering by Sesame India, is a comprehensive cashless banking solution that aids banks in extending digital and cashless services to their customers. To explore the complete solution suite and to schedule a FREE demo, get in touch with us today!

5 most anticipated and emerging Banking Technology trends

 

FinTech

Banking Technology Trends

When we look at how technology is transforming Banks today, we can clearly predict the move towards the greater adoption of the latest innovations.

This is the age of digitization and technology is playing a crucial role in shaping India’s Banking scenario. Looking at the state of technology in India and of the world at large, with the extensive availability of 3G and 4G networks and the spread of smartphones, it is creating newer and enhanced customer expectations, multi-feature product offerings and a greater demand for state of the art FinTech solutions.

Today Banks have much greater onus of welcoming proactive technological transformations. They have to bring in these changes because now they need to make themselves available anytime and anywhere to their customers, to stay alive in this highly competitive market.  What is interesting is the fact that these factors that are influencing banking today are the same factors serving as a basis for all the latest emerging trends.

Let us have a look at the anticipated technology trends we think will be significant in the world of Banking.

FinTech Disruption

We are aware that the Electronic exchanges, and the standardized application systems have driven the transformation of financial value chains. There is no doubt whatsoever in stating that the most significant development recently in the financial industry is none other than “Financial Technology” (FinTech). It comprises a broad range of innovations and advanced business models powered by information technology. FinTech is so phenomenal that it is shaping policies and creating a global-scale trend. The areas where the FinTech disruption will be strongly felt are fund transfers, consumer banking and wealth management. A highly impactful combination of alternative credit models with powerful data analytics will transform innovations in lending.

Distributed ledgers to authenticate IOT devices

Distributed ledgers, more commonly known as Blockchains have already become a major technological innovation. Now, leverage this technology to authenticate IOT devices, we can see a real-time system for value exchange. The exciting part would be that it is almost free. Internet of Things can be the future of distributed ledgers in financial services. Major Banks will lead the way by revising standards to pave way for the transformations. We may see signs of such a change starting thing year. The next five years will prove to be the defining moment for this transformation.

Impact of Big Data Solutions

With banks requiring deeper understanding of customer needs for competitive advantage, they are now betting on analyzing the ever-increasing volumes of data, to get right into their customer’s psyche. They are quite right in doing so. Big Data in banks have the tremendous capability of maximizing the value of their customer data by leveraging big data analytics across the key areas such as marketshare growth, customer retention etc. Lead generation for customer acquisition can be effectively improved. Various analyses help enhance Customer experience, engagement and loyalty, leading to much better sales and profits. However, considering the great things Big Data can offer, Banks are not utilizing its true power, at least not yet. It is high time that Banks start tapping the immense potential of Big Data Analytics. Probably this may be the year for successful big data initiatives that will go on to define the future.

Advanced Security Systems

The major problem with technological advancement is that Banks are now forced to fend off more number of advanced and complicated security threats. There is an unprecedented number of data breaches and an increased risk of cyber threats. With an increase in digitization, multi-channel proliferation there is greater risk of cyber-attacks that can translate into frauds and ultimately loss of customer’s trust. Realizing how crucial the situation is, Banks are stepping up the security. We now see more banks using biometrics and tokenization for banking activities. With digital channels slowly becoming the most preferred choice of customers for Banking services we will see increased security measures such as multilayered authentications. Going forward, we will see more banks adopting secure access methods without compromising customer convenience.

Financial Inclusion through Business Correspondent Solution

Rapid increase in the number of smart phones and decreased cost of electronic hardware such as Point of Transaction (POT) machines, have made offering financial services to the poor a much easier task these days. Business Correspondent Model is a modern, innovative banking approach that helps to service the financial needs of the unbanked sectors leveraging the latest technology devices.

Financial Inclusion Business Correspondent (FIBC) Solutions extend banking practices of the premises embedded on next -gen gadgets like tablets and smart phones. These solutions offer all the necessary BC Model features for helping people meet their financial needs and strengthen bank’s business. The solution facilitates technologies like Micro ATMs that allow customers to perform the basic financial transactions by using customer’s ATM card or thumb reading (Biometric). Seamlessly integrating the Card-Swiping machines to a Tablet at any location with connectivity, now FIBC solutions can provide easy to use technology to any individual.

Since Banks are now shifting their focus to improve Financial Inclusion, for customer engagement and to grow their business, a low cost, technology based, innovative service delivery mechanism such as FIBC looks increasingly viable. We might see more Banks adopting this model so that they can offer lower-cost structures by leveraging digital technologies.

Let us sum up our predictions for the year 2016: Banks are expected to create greater room for digital innovations to rise above heavy competition. They will have to accept the FinTech Disruptions by adopting them smoothly and seamlessly, and they may even have to start looking for partnering with FinTech firms.  Though IOT and Blockchains together looks new and untested, you never know what is in store, let us wait and see.  With Financial Inclusion gaining limelight in government agendas, Banks may start looking for low cost technology based options to service the underserved and even make a considerable profit.  Finally, banks will have to step up their game to offer enhanced security to protect and distance themselves from cyber-attacks and yet continue providing better customer experience.

 

The Best Innovation Award 2015 goes to Sesame, for MyBank Mobile App

Malappuram, Dec 31, 2015 – At the Innovation award event for recognizing the Innovations in the Co-operative Banking Sector, Sesame Software,  one of the  leaders  in core banking software solution and services for Co-operative, Service and Urban Banks, won the Innovation Award 2015 for the MyBank Mobile App.

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Business Correspondent Model: Why Co-operative Banks are ideally suited to adopt Business Correspondent Model?

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Business Correspondent Model: Are Co-op. Banks more realistic choice for BC adoption?

India has been witnessing poverty and exclusion for decades. A large segment of the society, those belonging to low income groups, have little or no access to formal financial services. In this regard, in the early 2000s, the agenda for financial Inclusion was emphatically underlined and gained prominence. Since then, over the years, the Indian government and the Reserve Bank of India (RBI) have been proactively undertaking numerous initiatives such as priority sector lending requirements for banks, Regional Rural Banks establishments, self-help group-bank linkage programmes etc.

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