Kotak Mahindra Bank’s focus is to ‘digitise all processes’

By Anil Urs

Digitisation has been closely aligned with Kotak Mahindra Bank’s core strategy. In an interview to BusinessLine, Deepak Sharma, Chief Digital Officer, explains how the private sector bank has benefited by adopting digital initiatives and how it has helped customers transact in a transparent manner. Excerpts:

How has Kotak Mahindra Bank’s digital journey panned out so far?

Digital is closely aligned with Kotak’s core strategy and our digital initiatives are focussed on customer and revenue growth, efficiency, customer experience, digital payments, risk management, security innovation and future readiness.

Various tech initiatives and transformation projects are directed towards this.

How much of Kotak Bank’s revenues come from the digital channel and what are the expenses involved?

The bank’s digital channel works as a horizontal layer, thereby creating value for different customer segments and business verticals. While some are direct revenue, cost and efficiency initiatives, others are linked to innovation, security and customer experience.

We track and measure the impact of the initiatives across various parameters which are not necessarily cost and revenue centric.


Most recently, we concluded our maiden payment co-creation programme, where we selected six innovative companies from over 130 entries that we received to work with us in the digital payments space for different segments like SME, modern trade, consumers and rural customers.

The twin objectives of this Kotak Payment Co-creation Programme are to provide an impetus to fintech-bank partnerships and build an ecosystem of collaboration and innovation for start-ups and fintechs in the digital payments space.

What is the time taken for conversion of customers from physical to digital mode?

We saw early success due to the rich features in our mobile banking app, which has over 100 features like banking, payments, shopping, loans, investments, etc.

By educating and on-boarding customers early on to our digital channels, we have seen higher adoption levels, greater engagement and higher number and value of transactions.

As of now, over two-thirds of our customers are digitally active, our log-in frequency is amongst the highest in the industry, and with a 2 per cent share of India’s deposits, we command around 8 per cent of India’s mobile banking transaction value.

What is the level of digitisation now, and what is the target set by the bank?

Kotak Mahindra Bank last week announced its digital-first organic growth strategy that will be driven by its ABCD charter — AI-enriched app; biometric-enabled branch; context enhanced customer experience; and data empowered design.

Our focus is to digitise all processes and make them paperless, frictionless using straight-through processing. Some of our initiatives, such as biometric-based account opening, API-based paperless processing of service requests and robotic process automation are all a part of this journey.

We continue to leverage technology like API, Artificial Intelligence, cognitive OCR, machine learning, design thinking, and data science and analytics to make progress on a transformation journey, wherein over the next couple of years the majority of processes at the consumer bank shall become paperless and straight-through processing.

How much more profitable are digital customers as compared to those who need physical assistance?

A majority of our digitally -ctive customers are omni-channel customers. Such customers are highly engaged and we see higher product holdings and relationship value with such customers.

What has been the bank’s innovations and its engagement with industry bodies like Nasscom?

We started the Kotak Innovation Lab and Fintech partnership programme early on to focus on future tech and value creation. We have completed over 100 POC (proof of concept) and onboarded over 60 fintechs to work with us in areas like lending, robotic automation, payments, artificial intelligence, customer experience and blockchain, among others.

We have also partnered with various accelerators, innovation hubs and VC firms in this process. We have partnered with the Nasscom 10,000 Startups initiative to support and co-create solutions which are relevant for India.