Montek hints at more banking reforms

On the banking sector8217;s computerisation programme, he said the bank managements had not utilised the flexibility provided by the labour unions in the computerisation programme. The achievement so far was much below than what was accepted. If the banks were to take up the challenge of competition, there was need for a revolution in banking technology, he added.

Stating that the first phase of banking reforms had considerably improved the prudential norms and supervisory structure. He said reforms were needed to put the bankingsector on a sound footing.

Ahluwalia said lack of competition among the Indian banks had acted as an hindrance in the modernisation of the sector. But the situation had changed and the banks should go in for newer technologies instead of replacing manual work with computers.

He said technological changes elsewhere should drive the banking sector to change themselves and cater efficiently to their clients.

Referring to the target concept of the banks their computerisation programme, he said this had to be given up and the nature of banking experience should change to ensure better and satisfactory services to the customers.

If the country maintained a growth rate of seven to eight per cent, it would have a large number of people living in urban areas and also, the number of urban areas would increase. This would put a tremendous pressure on the banking sector.

The country, instead of looking at the banking sector in the developed nations, should follow the experience of advanced developing countries,he added.

Ahluwalia said the banking services were being unbundled with various new technologies such as anytime banking, internet banking and credit card. The nature of financial intermediations were changing.

The concept centre, the first of its kind, had been set up at a cost of Rs 2 crore. It depicted the enabling technology that would make future banking operations possible. It displayed different kinds of branch architecture that were emerging worldwide. It also emphasized self service banking through multiple delivery channels such as any time money, internet and telephones.

The centre was Infosys initiative to assist the banking industry to experience new generation technology being adopted by leading banks in the world, company chairman and managing director N R Narayana Murthy said. The technology exhibited would provide Indian banks the agility required for competing in the networked age and reap the benefits of globalisation. Leading international solution vendors to the banking sector suchas Digital, Icss, Intel, NCR, Oracle and Sun Microsystems have joined the Infosys initiative to effectively equip the banking industry for the next millennium.