1. Bank funds are getting cheaper. The country’s largest bank, State Bank of India, cut its interest rates for the second time in less than ten days. Several other banks including Union Bank of India, Bank of India and Canara Bank also followed suit. SBI announced a 0.25 per cent reduction in its benchmark prime lending rate, on Wednesday . The bank’s BPLR will be 12.25 per cent with effect from February 27.Union Bank cut its BPLR by 50 basis points from 13.25 per cent to 12.75 per cent.Canara Bank cut its BPLR by 25 basis points to 12.75 per cent.
Bank of India also cut its PLR by 50 basis points.
Bank of India also cut its PLR by 50 basis points.
2. Turnaround time is not a term that is used only in logistics and shipping industry. Bankers too have started using them frequently in relation to customer service.The Union Bank of India’s CMD Mr M.V. Nair, is on a project called ‘Nav Nirman’ that aims at improving turnaround time in his bank. The basic focus of the ‘Nav Nirman’ is to re-write the fundamental architecture of the bank to bring customer to the centre.He says, “The large business of any bank falls into four categories. They are: retail, SME sector, corporate sector and rural sector. And the needs of these four segments are different.”In the retail sector, there are two groups. One, is the old generation customer who would like to have personal banking at the branch level and the other is the new generation customer. The latter group may not like to visit the branch. They are online and want technology to deal with the product. In this regard, the bank has set up retail asset branches where it commits a turnaround time for the sanction of certain loans. This has to be given by technology and people. The bank has already announced a turnaround time of 48 hours for the sanction of educational loans. “This cannot be done unless you fundamentally change the architecture. That is what ‘Nav Nirman’ aims at,” he said. He explains how the changes will go beyond the financial architecture and affect even the physical lay-out.
He says, “First when you enter the branch, you will have ATMs and kiosks where transactions are done. I am also trying to implement passbook writers for updating passbooks. They can complete all their transaction in the first stage itself. We will call this as the transaction area. The advantage is that even though the branch may be closed, the transaction area will be open all 24 hours. You can do 80 per cent of the job in the transaction area.“After the transaction area, the branch area will come where the customer will get the teller and the product display. Once technology is used, you have more online data transaction, call centres, and CBS. Then the branches will be become freer. Then the next challenge is to connect with customers. To do this, nearly 5,000 officers of the bank were put on a two-day training programme where the bank tied up with different universities.”
He says, “First when you enter the branch, you will have ATMs and kiosks where transactions are done. I am also trying to implement passbook writers for updating passbooks. They can complete all their transaction in the first stage itself. We will call this as the transaction area. The advantage is that even though the branch may be closed, the transaction area will be open all 24 hours. You can do 80 per cent of the job in the transaction area.“After the transaction area, the branch area will come where the customer will get the teller and the product display. Once technology is used, you have more online data transaction, call centres, and CBS. Then the branches will be become freer. Then the next challenge is to connect with customers. To do this, nearly 5,000 officers of the bank were put on a two-day training programme where the bank tied up with different universities.”
