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Banking sector to adopt AI solutions to improve operational efficiency


The banking and financial services sector will see the increasing adoption of artificial intelligence in the days ahead, to make internal operations efficient and the customer experience more effective.

India’s largest private sector bank, HDFC Bank, is looking at disruptive technologies from start-ups in the FinTech space. Launching the fourth edition of the Digital Innovation Summit in Ahmedabad on Thursday, Nitin Chug, country head – digital banking, HDFC Bank, said Artificial Intelligence (AI) would be the most prominent technology driver for the banking sector in the coming days.

“Banks have increasingly started engaging with the start-up community to bring about effective fintech solutions. These are not merely aimed at customer experience, but are also aimed at the banks’ own internal operations. AI is the most prominent technology available at present. Once embedded (into the systems) they could alter a lot of processes in all organisations, not just banks,” Chug said during the launch.

From the technology intervention point of view, HDFC Bank has emphasised on experience, which, according to Chug, can be delivered on five things.

“Technology that gives a personalised experience, real-time services, relates with customers, and which is contextual and responsive so as to be quickly adopted. We are moving in this direction, to align ourselves with it,” he added.

The bank is already witnessing a rapid transition from offline to digital transactions. About 85 per cent of the transactions that take place for HDFC Bank are currently done through the digital mode. This represents a quantum jump from 45 per cent about five years ago.

“Mobile transactions have seen rapid growth since we launched a mobile app campaign in 2014. The share of mobile transactions is greater than net banking. We have seen this shift mostly in the past two years,” said Chug.

The summit provides a platform for start-ups to showcase their innovations, aimed at powering the bank’s next phase of growth. Started in 2016, the earlier three editions were held in Mumbai and Delhi.

At the day-long summit held at the Centre for Innovation Incubation & Entrepreneurship (CIIE), IIM-Ahmedabad, 24 start-ups shortlisted from 151 applications presented their ideas to a jury comprising HDFC Bank’s top management, representatives of CIIE, and 91springboard – a community resource agency. A total of three winners will be given a chance to deploy their solutions in HDFC Bank.

The innovations have been in the areas of AI, machine learning (ML), analytics, and robotic process automation, among others.

The bank aims to help these start-ups bring out a consumer-ready product.

It will use its domain expertise to mentor start-ups on customer experience, reduce time-to-market and costs, among other domains.

In turn, entrepreneurs will be able to use the bank’s platform to test their ideas in the real world and expert insights.

“The objective of the Digital Innovation Summit in Gujarat is to have at its disposal a pool of cutting-edge world technology solutions,” Chug said.

The innovative ideas will be introduced in areas such as Mobile Banking, Customer Experience, Cyber Security, Social Banking, Payments, Branch Automation, and Operational Efficiency.