There’ll be one more flare up of NPAs in future, says ARCIL CEO Mohapatra

Some of the eminent speakers are Union Minister for Commerce and Industry Piyush Goyal, SBI chairman Dinesh Khara, Infosys Non-Executive Chairman Nandan Nilekani, MoS for Ministry of Finance Dr Bhagwat Kisan Rao Karad and RBI Deputy Governor M Rajeshwar Rao, among others’.

Catch all the live updates here:

2.30 PM: The 14th Mint Annual Banking Conclave has started.

2.40 PM: Banks have opened 240 million bank accounts, which is fulfilling the goal of financial inclusion in the country, says Mint Editor-in-Chief Sruthijith K K.

2.42: The percentage of bad loans in March was 7.5%, which is a significant improvement, says KK.

2.43 PM: Around 37 per cent loans extended are now in the buy now pay later category, says KK.

2.50 PM: VV Balaji, Head, Business Technology Group, ICICI Bank, on new technologies: Mobile banking has penetrated across the country. Even in villages, they use quite a bit of tech these days. We Indians don’t have too much legacy, which is an advantage and Indian banks are adopting very fast.

2.55 PM: Anjani Rathor, Chief Digital Officer, HDFC Bank, on new techs: “These are areas where everyone has diff strategies therefore outcome is very different.”

3.00 PM: VV Balaji Head on AI and intelligent automation: “In the last few years, there are consortiums formed globally on new techs. It should be successful. But we also have to see its practicality.”

Also read: Evolving tech still don’t have relevant use cases in Indian banking: Kotak Bank’s Deepak Sharma

3.15 PM: Anjani Rathore, Anjani Rathor, Chief Digital Officer, HDFC Bank, on linking new techs: “We need to monitor the end-to-end path. Therefore, the whole process becomes complex. New techs adoption will lead to new risks and we need to work with regulators to ensure make them risk-free.”

3.20 PM: Hemant Dabke, Senior Director, enterprise sales, Uipath, on what banks can do better to adopt new techs: “Two things — one is there’s still a psychological barrier in automation, especially when there’s the tendency to throw more. The other bigger problem is the ecosystem. How do they engage with the larger ecosystem.”

3.30 PM: Sameer Shetty, President, digital business & transformation, Axis Bank: “It is important to have a clear notion that you are not putting money behind new tech without a clear outlook. Also, there is a mindset shift but there’s not enough change in appetite to spend.”

3.35 PM: VV Balaji, Head, business technology group, ICICI Bank, on the future of banking after 5 years: “How do embed banking day-to-day life. You’ll more of it future.”

Also read: Evolving tech still don’t have relevant use cases in Indian banking: Kotak Bank’s Deepak Sharma

The next session will be ‘capability demonstration by startups’. The first among five sessions that will be discussed is by ‘Data Science Wizards’.

3.38 PM: Sandeep Data Science Wizards on its UnifyAI platform architecture: “There are three key building blocks of UnifyAI Platform – Data Pipeline, Machine Learning & AI, and UnifyAI Orchestrator.”

3.40 PM: TransCognit Informatics is an Indian startup working in the two domains of Sovereign Fintech, Central Bank Digital Currencies (CBDCs), and Digital Asset Management (DAM) through tokenisation. It intends to create products and services in these spaces, particularly around DAM over CBDC.

4.35 PM: Jar is a startup that helps Indians rediscover advantages of saving every single day. It aims to reintroduce the current generation to the concept of piggy banks by helping them save in digital gold and staying bank agnostic so that no matter who a user banks with, they can always save using Jar.

4.36 PM: FanPay is a marketing and distribution partner of IDFC FIRST Bank Prepaid Card. With FamPay and its numberless prepaid card, minors can successfully make online and offline payments without the need to set up a bank account. 

4.45 PM: Saurabh Tripathi, Managing Director & Senior Partner, BCG, on ‘Future of banking’: “QR Codes are growing at humongous pace. Amount of transaction data is going to be huge.”

4.50 PM: Saurabh Tripathi on future of banking

“Focus on customer experience

Design capability

Advance analytics

Technology stack

Partnership business” 

Also read: Lending will undergo dramatic transformation in 3 years: BCG’s Saurabh Tripathi

The next session will be on ‘DeFi: Disrupting or transforming banking?’

4.23 PM: Vishakha Singh, Co-founder & Vice President, WazirX NFT marketplace, on the connection between Defi and NFT: “For us, we have to acknowledge that blockchain is the ‘baap’ of all techs. Because of the decentralisation ethos, blockchain has posed a threat in the way we were transacting. With blockchain, it has cut down on costs. It’s much faster. A lot of times, people confuse crypto as a currency only, but it’s just one function of blockchain. NFT is sustaining be the cause of blockchain tech. NFTs are a source of income for collections and even NFT is still much safer.”

4.24 PM: Prasanna Lohar, Head, Technology, DCB Bank, on Defi and blockchain: “This is a new way. How to look into the non-fungible assets? It can’t be traded but ownership can be transferred. How can you claim multiple copies without blockchain? So there are multiple use cases of blockchain. You can find a lot of use-cases in the banking space in the future.”

4.25 PM: Hemant Adarkar, Technology Advisor and Resident Senior Fellow, IDFC Institute, on the future of DeFi: “There is a limitation to even this technology. Therefore, though we all have to join the bandwagon, this has to be properly studied and regulated.”

The next session is on ‘How digital inclusion can aid financial inclusion’

4.40 PM: CS Setty, Managing Director, SBI, on how much banking ground has been covered in the country: “The first-time bank customers will keep adding. A large coverage has happened so far. Now we are moving towards a new phase of financial inclusion. But, the basic access to the banking is broadly covered (in India).”

4.45 PM: Bhargavi Zaveri – Shah, National University of Singapore, on financial inclusion in India: “Digital inclusion is not an end but a means to an end that hopefully, financial inclusion will give people a better life. There is a 2019 survey conducted by the National Council for Financial Education, which says at an all-India level 87 percent of people have and operate a banking account. But when it comes to the recurring deposit, 37 per cent new what it was, and 18 per cent were using the RD. Around 60 per cent of them knew what was term deposit, and 14 per cent were using a term deposit. So, after having a bank account, the next big challenge is how do you get the consumer to use the bank account more efficiently. Around 53 per cent of people were aware of credit and 12 per cent were using it. Around 30 per cent knew what a PPF account is and 9 per cent of them had a PPF account. So the first hurdle of opening more banking accounts is crossed, now the question is how do you make people use these products more efficiently.”

Also read: JAM trinity transformed the concept of financial inclusion: SBI’s C S Setty

The next session is on Leveraging analytics for asset resolution and managing NPAs:

5.20 PM: Aniruddha Sen, Partner, Trilegal on IBC: “There are some gaps with the IBC but on paper, it’s a good law. The biggest issue is the judicial system. The availability of tribunals and justices to apply the law correctly. There is a case for more. Overall, IBC is a case of good law but it has been frustrated by the fact that its novel, which is why I think it has led to slightly less than expected performance.”

5.25 PM: Pallav Mohapatra, CEO, ARCIL, on NPAs: “After 2014, the volume of NPAs went up in the large corporate sector, now almost all things have stabilised. The fresh NPAs coming out from the large corporate sector will be few now. But the stress grew in the Covid time because of the lockdown in MSE and retail sector. There might be one more outburst of NPAs. Whether it will be as bad as in the 2010 scenario, there is no definite answer, but I feel there will be one more flare-up of NPAs in the coming future.”

Also read: NPAs in large corporates have more or less stabilised: ARCIL CEO

RK Bansal, CEO, Edelweiss ARC, on IBC: “IBC has worked well. It is the basic question of the asset that’s there in the system. Now the only thing where IBC faulted to some extent was — not many benches; IBC started working as a typical court; and there were no good cases being referred to the IBC.”

Pallav Mohapatra on the liquidity issue at ARCs: “If the ARC does not have liquidity, it’s going to be in the problem. Unless ARCs have skin in the game, they’ll not be honest in their approach in resolving the cases.”