Vymo Spotlight - May
We’ve curated the best stories from our insurance and banking newsletters this month.
Featured in this issue:
We hope you find it interesting.
Choosing the Right Tech ??????
As more and more banks are thinking seriously about their digital growth and transformation, we thought it would be interesting to sit down with someone from a major bank to dissect how they are approaching it.?
Recently,? Anshu Sahai - Vice President, Technology at Bandhan Bank spoke to use about the bank’s tech growth, how they evaluate new software, and more!
Tell us about yourself and Bandhan Bank.
Sure! Hello, everyone. I'm Anshu, overseeing technology for cards and payments, as well as managing LOS and collections across all assets at Bandhan Bank.
Bandhan Bank began its journey 23 years ago in 2001 as Bandhan Financials, focusing on microfinance, particularly lending to entrepreneurs who were primarily women.?
In 2015, we evolved into a universal bank, offering a wide range of products and services, including assets and liabilities.
What has your journey with technology been like so far?
Our digital journey was sparked by the need to enhance our operations, particularly in microfinance and unsecured lending, which have been our main focus since 2001. Despite growing organically, we reached a point where our scale required more streamlined processes, prompting a shift towards leveraging technology.
The pivotal moment came in October last year when we transitioned from an outsourced, SAS-based core banking platform to an in-house system. This move was crucial for managing our sizable asset book effectively.
When did you realize the need for a more robust system?
Concerning collections, while we maintained decent efficiency, the onset of the COVID-19 pandemic highlighted the need for a more robust system to handle delinquency. Although we had previously engaged with a vendor in 2021, it wasn't until after our core banking platform migration that we began seriously evaluating our options.
How did you evaluate software and make sure it’s right for you?
After deciding to explore options beyond our initial selection in 2001, we conducted a comprehensive evaluation of other potential partners. This evaluation encompassed rigorous assessments of functionality, technical capabilities, and commercial viability. We presented these potential partners with challenges specific to our unique approach to microfinance, particularly in handling group loans, from acquisition to collections and delinquency management.
We also talk to industry experts who use each platform and make our decisions with their insights.?
?From Anshu’s insights, we created a checklist of things banks should look for while assessing new software options:
Why Seamless Insurance Distribution is the Future ??
Fundamental shifts in the insurance industry are accelerating changes in the distribution landscape. How can insurers position themselves for the next wave of growth?
In a recent conversation with the CTO of one of the largest insurance conglomerates in Asia, we discussed the advantages of seamless insurance distribution and how it will redefine the way insurance is sold.
领英推荐
On the Challenges in the Current Global Insurance Distribution System
I will start with the problem definition. The distributor issue is a fascinating problem to solve. Around 70-75% of our revenue actually comes through the distributed ecosystem. It's substantial! This means that a significant chunk of our revenue comes from distributors because we lack a direct-to-customer (D2C) channel.
This reality spans insurance organizations and products, including health, life, and corporate. Although there are apps for each of these product businesses, customers still call the distributor when they encounter problems.
When it was time to address this issue, we sought solutions globally. I'm not exaggerating—I've spoken to people from America to Australia to see if they had a solution. However, all we received were bits and pieces, such as suggestions for onboarding processes, campaign initiatives, or a bit of analytics.
There was nothing comprehensive.
What Are the Next Generation of Distributors Looking For?
Distributors are here to stay. Many of our distributors are over 60, with many distribution companies now managed by their children in their late twenties or early thirties. Their feedback was clear: they need better systems, not just miscellaneous tools, to enhance their sales efficiency and increase their personal wealth.
This demand for more comprehensive tools was a recurring theme in our discussions with distributors. Given the large revenue stemming from these businesses, they are eager to move forward. In this context, Vymo's solutions seemed like a perfect fit. If we focus solely on onboarding, the distributors remain unenthusiastic. They want extensive functionalities and are impatient for improvements. We are adopting an approach of delivering a "maximum viable product" rather than a minimal one, applying this strategy across numerous products.
What’s the Future of Insurance Distribution Like?
Contrary to some beliefs, the distributor ecosystem in India is robust and likely to persist. While the very wealthy may have private banking and relationship managers to manage their needs, this represents a small portion of the population.
For those in the middle class, or slightly above or below, a personalized advisory system is essential. The problem is significant. I've heard, for example, that many investment decisions in India are influenced by chartered accountants during tax consultations! A friend who is launching a startup mentioned that a robust distributor system could address this gap, as it provides smart advisors who aren't just accountants. This could open up basic wealth management and insurance access to a demographic of 30-40 million people in India.
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Thus, it's not only large companies that need these solutions. There's a widespread need across India due to the current investment advisory approach being overly focused on taxation. Furthermore, extensive wealth management solutions are often not affordable for the average person. Despite discussions over the past seven to eight years about robotic automation replacing the need for branches and relationship managers, I have yet to see evidence supporting this shift.
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