Tag: technology

RBI moots easier rules for investing overseas, BFSI News, ET BFSI

Banking & Finance

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The Reserve Bank of India (RBI) is batting for easier overseas investment norms for Indian tech entrepreneurs and angel investors, said people with direct knowledge of the matter. As per the current rules, if an Indian resident buys shares in an unlisted company abroad, the foreign company cannot create any more step-down subsidiaries. This has proved to be a hindrance for Indian entrepreneurs looking to invest in foreign startups since it restricts the scalability of such companies.
Now, the RBI has learnt to have given a recommendation to the finance ministry, saying if such step-down subsidiaries are being opened as part of genuine and ‘bona fide’ expansion plans of a company, the restriction should not be applied.

Consultations with Industry
Emails sent to the RBI and the finance ministry remained unanswered until press time.
“Indian tech entrepreneurs are constantly looking for acquisition opportunities especially in the other developing countries; however, current rules make it very difficult to make such investments,” said a person cited above. “These investments have potential to bring dollar money back into India if the business venture succeeds.”

The RBI has held extensive consultations with the industry and the recommendations are based on inputs so received, said people cited above. Overseas investments by Indian residents fall under the ambit of the Liberalised Remittance Scheme. “A natural outcome of growth is expansion and hence it is extremely important that the step-down subsidiaries restriction be reconsidered,” said Moin Ladha, partner, Khaitan & Co. “This will enable Indian investors to get the advantages associated with such diversification.”

Indian owns less than 10% equity in the company. Portfolio investments enjoy liberal rules since they are meant for investment purposes only.

Currently, if an Indian buys shares of an unlisted foreign company, the company is presumed to be a joint venture. For instance, say an Indian ‘A’ buys a few shares of ByteDance – the parent of TikTok and an unlisted startup. Indian regulators presume that ByteDance is a JV where ‘A’ exerts some sort of control. Accordingly, ‘A’ is required to meet the steep compliance norms under the RBI rules.

In contrast, if ‘A’ had invested in shares of a foreign listed company, say Microsoft, it would have been considered a portfolio investment and would have been exempt from the compliance norms.

“It is impractical for a minority shareholder to be able to procure information or influence decisions of an overseas entity where they hold investment,” said a person with direct knowledge of the matter. “However, the current regime treat seven a minority investment as setting up or acquiring a joint venture abroad.”

The industry is also learnt to have requested the RBI to reconsider several more regulations. Most important of them all was a request to increase the cap on the LRS route. Currently under LRS, an Indian can remit a maximum of $250,000per financial year. The industry suggested the same to be hiked to at least $350,000. However, the RBI has so far not actedon the input, people cited above said.

Until a few years ago, outward remittance rules used to be the policy domain of RBI under the Foreign Exchange and Management Act (Fema). In other words, RBI could tweak the rules on its own. However, in 2019 the Centre replaced the rules is in the hands of the finance ministry. The RBI has been assigned the role of administering the implementation of NDI rules.



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Maveric Systems to hire 1,200

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Maveric Systems, a global banking technology transformation company, plans to hire around 1,200 employees over the next 12 months amidst a spike in digital adoption by banks and financial institutions since the onset of the Covid-19 pandemic.

“The scale up this year has been very intense. In March, we started with about 2,000 people (only delivery team) and we are likely to end up with 3,200 employees by March 2022. Out of this, 800 people have already been recruited in the first half and 400 people are likely to be recruited in the next half,” said Ranga Reddy, Global CEO, Maveric Systems.

“For the next financial year, we might need another 800-1,000 people. So, between now and September 2022, we would be adding 1,200 people,” he added.

Started in 2000, Maveric Systems is a banking-only focused technology transformation company with a specialisation on retail, corporate banking and wealth management segments.

Budget for IT

Reddy said banks typically have two types of budgets for IT : ‘Change the bank budget’ which are strategic in nature involving investments in technological transformation and ‘Run the bank budget’, which are investments in technology to run day-to-day operations. Currently, 75 per cent of Maveric’s revenue comes from the strategic side while ‘run the bank’ solutions account for the remaining.

“The major difference between large IT competitors and Maveric is that 75 per cent of our team is capable of doing transformation whereas in large IT firms, 75 per cent of people are capable of running the bank operations,” Reddy said.

The choice to focus on the strategic side of the bank paid off as the Covid-19 pandemic accelerated the pace of digital adoption by banks and financial institutions.

“Last financial year and this year, we have grown at 40 per cent CAGR. We have the potential to grow at a CAGR of 30 per cent year-on-year for the next 3 years organically without acquiring new customers,” Reddy said.

The company estimates to close the current fiscal with ₹520 crore in revenue and projects a revenue of about ₹640 crore for the next fiscal based on current projections and demand from customers.

Maveric categorises its customers into strategic accounts (comprising top 15 global banks), key accounts (regional banks) and fintechs with a revenue contribution of 50 per cent, 40 per cent and 10 per cent respectively.

Maveric Systems has presence across 15 countries with regional delivery capabilities in Bengaluru, Chennai, Dubai, London, Poland, Riyadh and Singapore. It plans to foray into the European market in March 2022.

“We are preparing for a new game to acquire more key accounts in Europe. Come March, we will enter Europe with client acquisition as a focus. We would like to add three more strategic accounts and six more key accounts all coming from Europe,” he added.

Currently, it has five strategic accounts, six key accounts and five fintechs.

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Need to improve quality, depth of audit: RBI Governor Shaktikanta Das

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Undesirable practices and structures, including incorrect assumptions in determining provisioning requirement for financial assets, diversion of funds and/or transfer of profits to connected parties, and real transactions getting camouflaged beneath various layers of IT solutions, should draw the attention of the auditors, according to Reserve Bank of India Governor Shaktikanta Das.

“One of the important roles of audit is to check the so called smart accounting practices, if any, followed by management to overstate profits or understate expenses / liabilities,” Das said in his address at the National Academy of Audit and Accounts (NAAA), Shimla.

Referring to Ind-AS (Indian Accounting Standards), which has been implemented for all listed companies (other than banks) in India, including NBFCs having net worth of more than ₹250 crore, the Governor observed that within Ind-AS, Ind-AS 109 with Expected Credit Loss (ECL) approach allows the management to exercise discretion and judgment in determining the provisioning requirement for their financial assets.

Das said: “Such flexibility and forward-looking nature of assessment, however, poses the ‘model risk’,that is, the model may rely on incorrect assumptions and may be far from representing the real-life scenarios. “This has been observed in several cases. Hence, auditors are expected to test the models used by the entities, challenge the management and validate the model outputs.”

Diversion of funds

The Governor said of late, several instances of related party transactions, without following ‘arms-length’ principle and established transfer pricing mechanism, have been observed.

“There have been instances of diversion of funds and/or transfer of profits to connected parties through various means – intra-group loans on favourable terms, over or under invoicing of transactions, asset transfers without fair valuation, etc,” he said.

Das emphasised that auditors need to identify and thoroughly scrutinise related or connected party transactions to ensure that there is no undue transfer of income or assets.

‘See-through’ IT layers

The Governor also flagged cases of manipulation and misstatement of the true nature of financial statements by employing opaque technological means (IT black boxes).

“Real transactions are camouflaged beneath various layers of IT solutions by a few entities. As such, auditors need to be technologically savvy and be able to ‘see-through’ the layers of information technology to detect the real nature of hidden transactions,” he said.

Das said since RBI, as the supervisor of the financial system, relies and leverages on the work done by auditors, the audit professionals are being sensitised through various fora to improve the quality of their reporting

He highlighted that:“We are constantly engaged with individual auditors, audit firms and the Institute of Chartered Accountants of India (ICAI) to improve the quality and depth of audit. A lot of work has been done in this area, but lot more needs to be done.”

Good governance

The Governor said the management has the responsibility for demonstrating, through its actions, the importance of ethical conduct.

While this is relevant for all businesses, it is even more important for financial institutions which hold public trust and depositors’ money in fiduciary capacity.

Das felt that financial sector entities, the audit community and the financial sector regulators and supervisors have to work together and take proactive steps to ensure good governance and ethical practices to build a strong and resilient financial sector.

Tech adoption

The Governor stressed that the auditing profession cannot afford to lag in adoption of technology. “Adopting technology tools such as computer-assisted audit tools and techniques (CAATTs) through constant upgradation and integration of new technologies will bring in a lot of efficiency in audits.

“In parallel, it has to be kept in mind that adoption of such technology tools for auditing cannot replace professional judgment,” he said.

A holistic approach is required while integrating technology tools in audit. The Governor said:“The profile of tomorrow’s auditor will be that of a critical, yet constructive challenger, with a clear focus on public interest and quality audits. There is a need to be even more professional, qualified, impartial, value-driven, ethical and display awareness and foresight.”

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Resources for developing financial literacy at a young age to ensure entrepreneurship-led growth, BFSI News, ET BFSI

Personal Finance

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Financial literacy, like every other life skill, is crucial. The earlier you expose it to your children, the better their money management abilities will be later in life. This money management practice lays a solid foundation for concepts like saving, spending, and investing in children.

Learning how to invest and manage money wisely will eventually become an important life skill for teenagers to master to achieve their goals. This becomes all the more important as India’s growth and development is going to be entrepreneurship-led in the future and learning the ropes of money management skills is very crucial at a young age.

Unfortunately, financial literacy is often left out of the traditional educational system’s curriculum. Children and teens enter adulthood without knowing how to manage their resources properly. As a result, parents are the primary educators when it comes to teaching teenagers money management skills.

Following are some ways parents can teach their kids about financial literacy:

  • To start, parents can give kids money to buy food in the school canteen to be able to keep a check on their expenses.
  • You can also help them understand the cost of things so that they will understand the value of money.
  • Piggy banks can be a great start for kids to learn about savings. They will cut out on expenses to start saving a little every day, thus beginning their journey towards financial education.
  • If kids list a few things, try not to buy them everything. Let them instead choose a few things to buy from that list. This will help them to spend wisely.
  • Monopoly and other business games will also make them proactive about money matters.
  • Take your kids to the supermarket, let them know your budget, and sit with them while preparing a rough list of things you want to buy in the supermarket.
  • Let them know if you’re facing any financial crisis, they might cut down their expenses and learn to spend wisely on things that matter.
  • Gradually introduce them to the world of investments, starting with an FD; open a bank account for them as well.
  • Once they learn about the benefits of investing in FDs, they gradually introduce them to other investment instruments.
  • Technology has also made investing simple with just one click, allowing consumers to invest with simplicity. Introduce your child to the concept of digital finance and help them make informed financial decisions.

Several organizations have taken the following actions to ensure that the teens are financially literate as part of the government’s financial literacy strategy.
1. Project Financial Literacy
The Reserve Bank of India (RBI) has undertaken a project, “Project Financial Literacy.” The project’s objective is to impart information regarding the central bank and banking concepts to various target groups, including school- and college-going children, defence personnel, senior citizens, women, and the rural and urban poor.The project is implemented in two modules. One module lets users get acquainted with the role and functions of the Reserve Bank of India. In the other module, users are introduced to banking concepts.
2. NCERT – Personal Finance Supplementary Reading Material
There are a total of 9 modules covered in this sequentially: Financial Plan, Budgeting, Managing your Money, Financing Assets, Protecting your Assets, Investing Money, Retirement Planning, Taxes & you, and Career Planning.
3. Pocket Money – the student’s Guide to Money
It is a financial literacy initiative by the Securities and Exchange Board of India (SEBI) and the National Institute of Securities Markets (NISM). The objective of this is to help school-going children to understand the importance of financial management and the value of money.
4. Financial Education for School Children
This material was developed under the guidance of the Advisory Committee for the Investor Protection and Education Fund (IPEF) of the Securities Exchange Board of India (SEBI) and by the National Stock Exchange (NSE). It covers modules on the following: Money Matters, Planning, Budgeting, Investment, and Stock Market.
5. Introduction to Retirement Planning for School Students
This material is developed by the Pension Fund Regulatory & Development Authority. It aims to explain retirement and how to plan for retirement with various pension schemes effectively.
6. Commodity Futures Market for Students
This resource helps students understand the basics of commodity markets.
7. Material on Insurance for Children
The resource is available as comics and videos and is developed by the Insurance Regulatory and Development Authority (IRDA). It aims to explain the basics of insurance, several types of insurance, insurance ombudsman, ULIP (Unit Linked Insurance Plan), etc.

Allow your children to learn about money, regardless of their age. They can grow into financially responsible individuals and entrepreneurs who make sensible financial decisions with the proper guidance and healthy money management habits. Adults who are skilled at budgeting build family relationships while also contributing to economic progress.

(The writer is Co-founder & CEO, Pencilton)



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Tech, balanced infra & government intervention key for supply chain rehaul, say ETILC members, BFSI News, ET BFSI

Banking & Finance

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According to the Logistics Performance Index issued by the World Bank, India ranked 44th in global logistics performance. Its logistics costs amount to a high 14 percent of GDP, 6 percent representing transportation (Arthur D. Little Analysis 2020). Despite being large and well-connected, India’s Supply Chain and Logistics sector is ripe with challenges. However, this can be transformed should we implement balanced logistics more and tackle the systemic issues around infrastructure and storage.

Setting Up Infrastructure
Road transportation, weighing around 64 percent of the country’s logistics infrastructure, has a necessitous transportation infrastructure. Not only is our rail and sea network infrastructure under-utilized and is wanting in terms of digital tech. Moreover, the cost of road transportation also stands higher than the latter. Better Inventory planning and demand forecasting could reduce the high indirect costs, amounting to USD 120 to 180 billion. India also has to set up more cold storage capacity that is 226.7 lakh tons, instead of the required 350 lt. As per the Indian Council of Food and Agriculture, this leads to a wastage of 30 percent of the total agricultural produce. India’s retail market comprises scattered micro-scale sellers, with a vast 90 percent of the total being kirana shops.

“Indian government’s reduction of global allocation of vaccine due domestic needs has created a gap between supply and demand, This has created imbalance in supply chain for third world countries dependent on India manufactured vaccines, further due infrastructure challenges mainly in cold chain supply chain and shortage of cold transportation equipment & trucks has added strain in entire vaccine supply chain,” says Karthi Baskar, Deputy Managing Director, Kintetsu World Express.

Covid-19 & Supply Chain
According to WHO, the ban, against the backdrop of the lethal second wave of Coronavirus, had affected around 91 countries as of June 1st. Adding to this predicament, with around 353 innovator drug contract manufacturing sites, Maharashtra saw a total 6 million Covid cases by June 15th. Apart from that, the inadequate capacity and an incompetent infrastructure of the cold chain supply adds to this disruption and is in need of urgent enhancement and augmentation with respect to the particular temperature requirements, and inventories for special equipments at airports. The lopsided distribution of cold supply prioritizing urban cities over other areas also needs to be recalibrated. Moreover, orders mandating the truck drivers to carry negative RT-PCR reports issued within the preceding 48 hours further added to the already struggling freight networks. However, despite these shortcomings, the Indian Pharmaceutical and healthcare supply chain has surprisingly shown significant potential in the post-covid scenario.

The Indian pharmaceutical sector, although previously underutilized, has now been pushed by the successive covid waves to become the sole means of allocating medicines, blood and plasma transfusions, oxygen concentrators, surgical kits, and vaccines. As per the health-tech report by IAMAI-Praxis, e-pharmacies and teleconsultation platforms witnessed an escalation of up to 200% and 300% in the frequency of orders in 2020. Despite critical infrastructural issues in the Indian healthcare chain, the covidian impact has catalyzed our health tech with disruption and technological intervention. We already benefit from an operative R&D and clinical trials framework. That, along with the recent ingenious solutions in R&D, owing to the rapid adaptation of AI, ML, deep science, and data analytics, make palpable India’s potential success in medical R&D based on tech.

With the preexisting Covid-19 outbreak along with the imposed nationwide lockdown, India also witnessed an increased exigency and frequency of orders. With respect to goods mobility, the logistics industry also encountered impediments concerning manpower, process visibility, accessibility to outlying areas as well as contactless delivery. Not only has the e-grocery industry tackled these obstacles, but it also further expanded the digitalization to small and medium business owners across categories such as consumer goods, grocery, fashion, electronics, books, and professional services. This led to both the augmentation of shopfloor digitalization in terms of its geographic operations as well as the widening of the merchants’ digital footprint.

“With the establishment of an effective infrastructure built upon cross-state standardized IT systems, interoperability and the adoption of global data standards, the Indian Supply Chain awaits an optimistic future,” says Sameer Khatri, Regional Director – Indian Subcontinent & MD India, DSV Air & Sea Pvt. Ltd.

“Post-covid, supply chains will be more localized, agile and flexible. At DICV, all these aspects have been amplified and accelerated, leading to enhanced transparency across the value chain and real time risk tracking,” says Managing Director & CEO, Daimler India Commercial Vehicles Pvt Ltd (DICV).

Cold Chains
The JLL report predicts the national cold chain sector to multiply at over 20% CAGR by 2025, owing to the reorganization of conventional cold storage into a modern storage facility. This can moreover give way to a proliferation of the same in both Tier-I cities like Mumbai, Bengaluru, Chennai, Pune, Kolkata, Delhi-NCR, and Hyderabad, along with Tier-II cities like Lucknow, Kanpur, Ranchi, and Patna. Both conventional and upcoming service providers now implement warehouse automation, digitally monitoring temperature-sensitive cargo, along with the incorporation of AI, ML, and IoT for medicine and vaccine transportation. With the expansion of cold supply chains and a gradual increase in organized logistics, the Indian startup ecosystem has also contributed tremendously by devising innovative services like digital solutions for tracking, payment, and dispatch. The government granted infrastructure status to the supply chain sector, leading to all this growth; this clears the sector for availing 100 percent foreign direct investment, enabling them to borrow vast amounts under the ECB.

Skill Development
A recurring obstacle in the refurbishment of the manufacturing and logistics sector appears to be the insufficiency of skilled workers. To this end, the Centre for Product Design and Manufacturing (CPDM) at the Indian Institute of Science, along with TalentSprint, has furthermore introduced a PG-level advanced certification program in digital manufacturing and smart factories. The program will aid management and small factory strategy professionals, along with IoT, FMCG, automotive aerospace pharma, and energy industry aspirants.

“On top of omni-channels providing seamless and cost-effective solutions, digitalization has added an extra edge to SCM,” says Vaibhav Vohra, Managing Director, Continental Carriers.

Owing to a multichannel approach to sales, it has been predicted that the Indian omni-channel and warehouse management systems’ market size will strengthen to USD 488 million by 2024 from USD 231 million in 2019 at a CAGR of 16.2%. Furthermore the CII Supply Chain Leadership Conclave (CPG & Pharma) held last year, examined the defects and limitations of the Indian Supply Chain Sector and devised a roadmap to “a resilient 21st century supply chain.” According to their Vision 2030, “India will be one of the top 20 countries in the World Bank Logistics Performance Index by 2030.” They aim to achieve these ends via optimization, digitalization, simplification of distribution systems, and adopting a sustainable, agile, and resilient supply chain. AI, ML, Blockchain, and IoT, Analytics, Robotics, AR, VR, Cyber Security, 3D Printing, and Additive Manufacturing are the means of revolutionizing the logistics industry. They would add to data management, traceability, security, end-to-end visibility, and analytical-based risk management. What seems to be next is the step towards Omni-channels to integrate virtual sales and in-store general sales.

“Government intervention is integral for promoting a fair competitive logistics market, balancing risk sharing between public and private sector, and avoiding creation of monopolie,” says Raaja Kanwar, Chairman and Managing Director, Apollo International.

As per Arthur D Little’s report, instituting regulatory and enabling policies is vital on the part of both the national as well as regional governments. Policies can be implemented pertaining to standardization of turnaround time, truck size, swifter license and permissions approvals as well as GST consolidation. Subsequently, SCM-friendly policies will also help expand logistics and broadband connectivity to relatively rural areas, thus working towards reimagining the Indian Supply Chain as a globally competitive one via “Atma Nirbhar Bharat” and “Make in India.”

“Since Logistics has a great environmental impact, it is crucial to work towards a Green Supply Chain by reducing emissions and eradicating waste,” says Sam Katgara, Partner, Jeena & Co.

With the integration of technology into the logistics sector, our next step to productivity should be optimizing transportation routes and adapting more renewable and durable models of transportation. Minimizing supply chain wastage and embracing recyclable means will further ensure compliance, profitability, and customer satisfaction.

“To ease digitalisation for small and medium sized retailers, access to dedicated, customised and affordable end-to-end integrated omni channel services is a game changer. At FM Logistic India, we have a complete portfolio of integrated services to facilitate this adaptation,” says Alexandre Amine Soufiani, MD & CEO, FM Logistic India.



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RBI lifts ban on HDFC Bank issuing credit cards, BFSI News, ET BFSI

Banking & Finance

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The Reserve Bank of India (RBI) has lifted an eight month ban on HDFC Bank in a big relief to the private sector lender, a bank spokesperson confirmed. On December 3, in an unprecedented move the bank was barred from issuing new credit cards and launching any new digital products after multiple issues linked to digital banking, cards and payments on the bank’s platform in the last two years.

HDFC Bank, the largest issuer of credit cards in India lost market share in the last few months as restrictions on issuing new cards meant sales stopped. Outstanding credit cards dropped from 15.4 million in November 2020 to 14.9 million in May 2021.

However, in a call with the media at the end of June the bank’s senior management expressed confidence that they will make up for the lost time by cross selling to liability and other asset customers once the ban on issuing new cards is lifted.

Parag Rao, group head, payments, consumer finance, digital banking and IT at HDFC Bank said the bank is preparing to return to the market “with a bang” whenever RBI removes the ban. In the last seven months the bank has put an early warning system to manage large volumes, declogged processes and replaced old technology as part of its short and long term plan submitted to RBI, Rao said.



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Varun Chopra, Eduvanz, BFSI News, ET BFSI

Personal Finance

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-By Tarika Sethia & Ishan Shah

The ed-tech boom in India has grown multi-fold in the last two years and Varun Chopra of Eduvanz, funding education and skill seekers believes the time is good and the focus will be on tier-2, 3 & 4 cities.

Varun Chopra, Co-founder & CEO at Eduvanz believes that banks have slightly burnt their fingers in financing higher education loans and Eduvanz found a space to fund students who are looking to do courses in domestic universities in India.

Varun said, “The idea was that how everybody is creating financial entities around a certain specific sector or product like an auto loan, property loan, microfinance, etc. We wanted to be the lender for learners.”

Pandemic Impact

The pandemic has accelerated Eduvanz’s growth journey. Some of the key drivers Varun sees is the New Education Policy 2020 and UGC Policy where degrees can be given online which has never happened before in India. So students who are sitting out of tier 2,3,4 cities, now don’t have to come to Bombay and Delhi to get educated, backed by the high penetration of the internet across India.

Eduvanz sanctions loans to these students and becomes one point of contact. It also launched no-cost loans where students can buy laptops, mobile phones at 0% interest.

Varun said, “0% is just a small behaviour change of another way of buying products and paying later. So just like BNPL is picking up in the consumer sector. We’ve created products like study-now-pay-later. So this SNPL product is really making a difference for both the consumer and the education institutes because for educational institutes it is helping them meet the demand of the students and increasing their enrollment and for students, it is at zero cost, it’s very beneficial.”

The average ticket size is around Rs 1.8 lakh and the average tenure of 18 months, but it starts lending at as low as Rs 20,000 to Rs 25,00,000. It has tied up with over 200 universities across countries.

Courses in demand & Risks

Varun highlights that courses and skill sets related to the BFSI, Analytics, Digital Marketing, Blockchain are in demand and students are trying to build their careers in these sectors. A big shift is also being seen in how work from home has benefited these students to pursue courses beyond working hours.

Varun adds, “Employment is backed by quality education and skillsets. Most of these educational courses are also becoming hybrid today. Some of these models are becoming very effective and that is where the boom in education learning is happening in India.

25% of the borrowers are introduced to educational institutes where they don’t have any tie-ups. While they may not get a 0% loan but are able to get their education financed at a cheaper cost, explains Varun.

It has brought down its exposures which are impacted by the pandemic also with institutes where placements have gone down and there’s an employability risk which is determined by its internally created score called ’employability score’.

BFSI, IT & Technology are the key drivers for now.

Impact on Existing book

Varun said, there has been an impact but luckily we were part of the impact-based lending. So we have partnered with Michael Susan Dell foundations, where we get the coverage if the borrower is not able to pay back. However, our portfolio is extremely solid.

It claims that they are one of the best performing fintech with NBFC license with NPAs less than 0.7% in spite of two phases of severed Covid-19 waves. He added, “We have reduced a little bit of exposure on each impacted sector. We have tweaked how much exposure some of the institutes we can take. To be honest, I think we have been fortunate enough because most of the borrowers get employed. Even if there is a delay in getting employed, these guys have been able to kind of repay back over a period of time.”

New Avenues

Eduvanz has also started financing school fees for which it acquired a company called ‘clarity’ last year. It provides students mentorship and industry guidance. Varun said, “We are creating an entirely digital platform around it, where we have partnerships at schools and colleges. Students can talk to these industry veterans and understand good career opportunities and options.”

It has also partnered with companies like Apple to finance study-related equipment where borrowers may want a laptop to do their education. Varun adds, “So there’s a lot of focus on creating a whole lender for learners, not just finance a part of their education, but anything related to their learning, whether it is in mobile devices, insurance, laptops.”

We are lenders for learners: Varun Chopra, Eduvanz

In the last four years, it has collected huge amounts of data on institutes, sectors, consumers, employment trends which has enabled them to create innovative products.

In terms of credit demand, Varun said, “ In the last four months we have constantly hit the highest. There is an extreme amount of demand and we are disbursing close to Rs 40-45 crore per month, and we are planning to reach Rs 75 crore in two to three months. So that’s the immediate target.”

Fundraise & Growth

Eduvanz is looking for a series-B round closely and will be more like a growth capital to build strong technology infrastructure and products and create a strong distribution model for learners.

Varun adds, “The ed-tech boom has led to a new kind of quality education turning up and no sector has grown without the availability of finance, every sector is to be pushed by the financial sector. Being somewhere where we were one of the first ones, we hope to carry this torch of growth in upcoming times.”



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SBI reshuffles roles at HR and Tech verticals, BFSI News, ET BFSI

Banking & Finance

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State bank of India (SBI) has announced a few key reshuffling in the bank’s HR and Technology departments.

Om Prakash Mishra who was elevated to the post of Deputy Managing Director (DMD) in May 2021, is now designated as DMD (HR) & Corporate Development Officer (CDO).

Prior to becoming the DMD, Om Prakash Mishra has held the position of Chief General Manager (CGM) of SBI Hyderabad Circle.

He has taken over from Rana Ashutosh Kumar Singh who is now holding the portfolio of DMD (Strategy) & Chief Digital Officer.

Rana Ashutosh Kumar Singh, who has been associated with SBI for nearly three decades, has handled important assignments in Retail Banking, Credit, HR and International Banking.

Ravindra Pandey who was serving as DMD (Strategy) & Chief Digital Officer, has now taken charge as DMD and Chief Information Officer (CIO).

In his new role, he is leading the entire IT Ecosystem of the Bank including the running of SBI’s Core Banking System, Digital Channels as well as 400+ applications. He is working towards future-proofing SBI by implementing emerging technologies like AI, ML, Analytics, Robotics, Blockchain etc. He has also had the international experience of heading SBI’s Paris (France) operations as CEO.



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Globally, Indian Banks lead the way in adopting new technologies, BFSI News, ET BFSI

Banking & Finance

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Mumbai: While the banking sector has been adapting to digital disruption for several years, COVID-19 has accelerated this transformation, opening up access and opportunity to millions of unbanked and under-banked consumers.

Leveraging technology to its fullest potential will not only stimulate growth but will enable Indian Banks to emerge as global leaders that will be among the strongest, resilient and most dynamic in the world.

Indian banks are leading all other banks around the world in adopting technologies. This was the collective opinion of leading bankers and experts in the BFSI sector who participated in a virtual discussion at the IMC Chamber of Commerce and Industry’s 11th Banking & Finance Conference on”How Technology is Reshaping Banking and Finance,” on July 15 & 16, 2021.

SBI Chairman Dinesh Khara spoke of SBI working towards launching the next version of Yono, adding that the bank had onboarded 40,000 overseas customers on the Yono platform by end of March 2021.

Speaking at the Conference, Guest of Honour, N. S. Vishwanathan, Former Deputy Governor, Reserve Bank of India said, “The government’s move to privatise two State-owned lenders, presents an ‘exciting opportunity’ for investors looking to get into the business.”

“The government has already been brave while presenting the Union budget and has confirmed that it is willing to stretch the deficit to make sure that the country continues to be on a growth path,” said K V Kamath, while speaking at an event.

Abizer Diwanji, Partner & Head – Financial Services, E&Yis of the opinion that defaults are bound to happen in the banking business, but one has to deal with them upfront rather than taking 5-7 years to deal with it.

Narendra Ostawal, MD, Warburg Pincus‘ said, “Private equity firms like his will be interested in investing in the bank privatisation process and see it as a ‘huge opportunity’.”

Arjit Basu, Chairman, Banking and Finance Committee in his introductory address affirmed that Technology is the core of global economy and we should fearlessly embrace new technologies and innovations. Diversion between Banks and financial institutions are slowly going away and Fintechs are the emerging banks of tomorrow.

In his welcome remarks, Rajiv Podar, President, IMC mentioned that the Indian economy has undergone a radical transformation in the last decade. The confluence of technology and finance, or Fintech as it is commonly known, has been at the centre of this change. India has emerged as one of the biggest Fintech hubs in the world, as new-age companies leveraged technology to change the way people and businesses avail banking and financial services.

Other sessions focused on the importance of ‘Corporate Governance’ in the banking systems, opportunities and risks involved in investing in the Indian banking and financial services, role of Fintechs and Payments Banks in the financial systems, and on how technology will help banking and financial services in future.

Also discussed were problems encountered by customers and banks due to the rapid digitization of the banking and finance sector, and how central banks can and should take the lead to ensure a Green Economy.MDs and CEOs of many other banks, Fintech companies, Private Equity Firmsalso participated in the conference.



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Razorpay acquires TERA Finlabs – The Hindu BusinessLine

Banking & Finance

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Razorpay on Monday announced its acquisition of TERA Finlabs, an AI-based risk tech SaaS Platform, for an undisclosed amount. 

“TERA Finlabs is a Bengaluru-based startup that provides technology, risk and capital solutions to enable innovative embedded financing solutions for businesses,” it said in a statement. 

TERA Finlabs is an Indian subsidiary of UK-based digital lender GAIN Credit.

Harshil Mathur, CEO and co-founder, Razorpay said, “The team at TERA FinLabs comes with exceptional domain knowledge in credit underwriting and risk managementand we see immense value in TERA Finlabs core lending infrastructure capabilities. Together, we are looking forward to addressing newer working capital issues faced by MSMEs.”

TERA will bring its entire technology stack, risk management capabilities, and onboarding solutions to create and enable a credit line for Razorpay’s merchantnetwork. Razorpay Capital along with TERA Finlab expects to service the credit needs of over 10,000 businesses in India by the next year.

This marks Razorpay’s third acquisition and comes following its foray into the B2B SME lending space with the launch of Razorpay Capital in 2019, the statement further said.

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