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Information is the key to drive growth in the digital realm: Abhishek Sharma, Chief Digital Officer, L&T Finance

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In the ever-evolving landscape of modern business, adaptation is key. For L&T Finance, this adaptation has taken the form of a dynamic digital transformation. Express Computer spoke with Abhishek Sharma, Chief Digital Officer, L&T Finance, who shares how digital initiatives have not only increased efficiency but also revolutionized customer experiences, fostered closer collaboration with clients, streamlined internal processes, and trimmed costs. Most importantly, they have positioned L&T Finance as a trailblazer, swiftly adapting to the shifting tides of technology and business trends.

Some edited excerpts:

Can you share some of the recent digital initiatives undertaken by your firm and the impact of the same?

We at L&T Finance have defined ‘Fintech@Scale’, as one of the most important pillars of the company’s growth strategy. We are partnering with technology partners across the fintech ecosystem, enabling us to provide customer with seamless journeys and enhanced offerings. Over the past couple of years, we have partnered with 30+ technology partners, helping us enhance operational efficiencies, improve customer experience, and access advanced risk assessment tools.

The various associations with the fintech ecosystem has allowed L&T Finance to harness power of new technologies, benefiting all our customers. They are now able to access various offerings and easily get their account statement, download repayment schedules, interest certificates, update mandates and much more in just click of a ‘button’.

Earlier in March 2022, L&T Finance launched PLANET (Personalised Lending & Assisted NETworks), a customer-facing app. The app has crossed over 5 million downloads and has assisted L&T Finance in expanding its digital footprint to remote corners of the country through the D2C proposition. The app aims to deepen customer engagement and features over 130 functions. It provides a bouquet of services ranging from providing servicing solutions to applying for a Consumer Loan, Two wheeler loan or a Microloan as well as creating an urban and farmer ecosystem. The app also provides additional customer engagement features like credit scores for all types of customers especially urban and mandi prices for farm customers. The app is being ramped up to create an end-to-end digital journey for the spectrum of products across both urban and rural customer landscapes.

Since the launch of the app in 2022, we have seen downloads of over 5 million with nearly 5.5 lakh rural customers. The app has since helped customers repay their EMI’s, conveniently service the loans and avail of curated loan offerings.

Apart from the app, L&T Finance also launched first of its kind digital journey for complex lending product categories like Warehouse Receipt Finance, multiple API integrations with collateral managers & processes to drive seamless KYC journey. Additionally, newer offerings like Rural Loan against property have also helped the organisation cater to rural customer base and strengthen the digital footprint across existing and newer geographies.

Overall, I believe that our digital initiatives have immensely helped increase our efficiency, enhance customer experience, improve collaboration with customers, streamline processes, reduce costs, and most importantly helped L&T Finance in adapting quickly to the changing trends and technologies which are best for business.

In the realm of marketing, data-driven decision-making is pivotal. How does L&T Finance utilize research and analytics to define and achieve key marketing KPIs?

At L&T Finance we rely heavily on research and analytics, and this helps us to arrive at data insights which play a crucial role in making informed decisions and driving business success. Since L&T Finance is a regulated organisation, we have access to structured bureau data which helps us understand industry & customer behaviour. Apart from the access to bureau data, we have multiple data sources including foot-on-street, digital sourcing & collection channels which also provide us with relevant information. All these together help us in understanding customer behaviour, preferences, and trends and thus make informed decisions that are in best interest of our customers.

The multiple reiteration of customer segmentation, mapped with campaign analytics has helped us in driving targeted marketing campaigns and personalised initiatives and experiences for our existing and new customers.

Apart from customer acquisition and delivering relevant marketing campaigns, data insights have also helped us in staying relevant for existing customers and provide them with differential offerings and even cross-sell existing products. Moreover, it has also helped us in retaining existing customers and even engage with new customers and win them.

In my opinion, data insights have helped us in providing improved services, identify prime customers and provide them with differentiated and premium offerings. We even use digital channels such as SMS, WhatsApp, Chatbot, IVR to create customer engagement and this further enables us to understand customer’s responsiveness and adaptability.

Looking ahead, what key areas do you believe will drive growth for L&T Finance in the digital realm? Are there any specific areas that you are particularly focusing on?

L&T Finance has articulated its four ‘pillars for growth’ strategy namely, a strong growth and profitability engine; strengths in risk management including new-age risks; creating ‘Fintech@Scale’; and finally, an Environmental, Social and Governance (ESG) and Corporate Social Responsibility (CSR) focus.

In our opinion, information is the key to drive growth in the digital realm. For instance, earlier information on assets being financed was easily available. However, the information on the borrowers was difficult to acquire. Now this limitation is behind us, with the credit bureaus coming up. Today information on the borrowers is easily available and can be used legally and within the parameters of data privacy laws. At L&T Finance while we take the bureau data and demographic data into consideration, we are also working in association with account aggregator. These aggregators help us by providing access to financial data and insights to customers, thus, allowing us to use relevant information to lend more and with safety, which in turn is helping L&T Finance in providing personalised offerings to our customers.

On the business front, we are growing strong and I’m confident of growth across business segments especially in the rural India. Currently, of our database of 2.1 crore customers nearly 1.4 crore are from the rural India.

That said, we are seeing rapid growth from products that were introduced in last 3 years like the consumer loans and SME loans. We also expect that newer offerings like Warehouse Receipt Financing an agri-allied loan product and small-sized business loans will add significant value to L&T Finance revenue growth and thus positively add to the bottom-line further.

Could you offer insights into any upcoming technologies or trends that you believe will have a significant impact on the financial sector and how L&T Finance plans to leverage them?

At the industry level, we are seeing lots of innovative technologies that could be leveraged to drive business further. Data driven through technology can also help organisations understand customers personas. Analysing various types of data, such as demographics, behaviours, preferences, and interactions can help create detailed profiles representing different segments of our target audience.

In-fact organisations like ours are today collecting and analysing data to gain insights into customers needs, motivations and need gaps and then tailor products, services, and marketing strategies to better meet their expectations.

In terms of the trends for the industry, we are seeing increased dependence and use of cloud computing, artificial intelligence, and machine learning. These innovative technologies are helping us in improving cost efficiencies, scalability, flexibility, faster deployment of services, improved data management and security, innovation, and collaboration and in many cases disaster recovery as well.

Lastly, we are seeing opportunity in leveraging Open Credit Enablement Network (OCEN) framework. OCEN is a digital infrastructure which can help in democratising the small ticket market in India. OCEN can help easy and improved interaction between both the lenders and borrowers on a same platform. OCEN allows individuals and organisations to securely share credit information with others while maintaining control on who can access it. Thus, the API framework helps by credit data sharing amongst the lenders legally of small businesses and thus, reducing the overall efforts and cost of acquiring information on the new customers.

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