The BFSI sector has always been the first to experiment and adopt emerging technologies, even when the business case is not so clear. Last year, while the hype about blockchain came down significantly, AI continued to be an increased area of interest. As expected, bots continued to be deployed across the enterprise, and showed the ability to handle queries of increased complexity and scale.
Kotak Mahindra Bank’s Keya, India’s first voice bot in the banking sector, handles more than a million interactions every month and successfully recognises the intent behind 70 per cent of all calls. Similarly, 120 bots deployed at ICICI Lombard General Insurance handle about 90 per cent of policy issuance in near real-time. As bots learn and unlearn and relearn, they are fast shaping up to handle extremely complex queries. For instance, Yes Bank’s mPOWER bot goes a step further and connects customers with the nearest sales person on call instantly via an automated call patching facility. It can even send an SMS to the nearest dealer for the customer, for arranging a test drive of the car selected in the bot.
With disruption being the norm in the BFSI sector, firms in this sector are opening up their platforms to startups. Banks like HDFC Bank, have adopted Open Banking, to partner with startups and other ecosystem partners via Open API. When the platform is open, a bank like HDFC Bank can partner with a pool of partners like fintech, startups and universities, giving it access to innovative ideas and providing a platform to test products. This provides the bank access to a very large ecosystem and people who are building relevant products and services.
The Mahindra and Mahindra Financial Services Group is testing a cloud powered blockchain platform for SME financing, which will be primarily used for bill discounting. CAMS, a mutual fund transfer agency is planning to do the Mutual Fund (MF) reconciliation using blockchain. Similarly, SBI General Insurance is exploring blockchain use cases in inventory tracking and payments.
In the future, as more channels go fully digital, one can expect a jump in the number of customers using the self service mode. A case in point is HDFC Ergo General Insurance, which is targeting 80 per cent transactions (for registering claims), to be completed on a self-service model from the existing 65 per cent. Similarly, DHFL Pramerica Life Insurance’s AceApp accounts for 70 per cent of the retail business of the firm now.
As banks and insurance firms partner with more startups, expect the BFSI sector to lead the rest of the industry in showing the true potential of emerging technologies.