Digital Initiatives Taken by Banks and Evaluation of Cyber Threats and Preparedness- IDBI

Industrial Development Bank of India (IDBI)

Introduction

IDBI has recently gone through a major upheaval due to worsening of its books and posting a loss of USD 332 million in the third quarter of the fiscal year 2016-17. This is primarily due to higher provisions for non performing assets (NPAs). Bad loans have been steadily rising for IDBI. 

The Indian government, which owns 74% stake in the Bank, has identified IDBI as one of the ten banks that needs to tighten its ship before the government infuses capital. Also, there are talks of government selling a portion of its stake once IDBI undertakes turnaround measures.

Digital Initiatives Taken  

Recent Digital Initiatives taken by IDBI 

•       Introduced instant new PIN generation for debit cards through IVR
•       mPOS (mobile Point of Sale) terminals launched
•       Introduced mobile banking application - IDBI Go Mobile App for iOS 
•      Bank soft launched ‘mPassbook’ Android App which is an electronic form of physical passbook
•      Introduced the facility for retail net banking customer to modify their daily net banking tran. limit upto Rs.5 lakh
•      Launched Immediate Payment System (IMPS) through Retail net banking
•      Launched RTGS facility through Corporate net banking

By June 2016, approximately 70 per cent of bank’s transactions were done through digital channels including ATMs.

Cyber Threats

•       IDBI recalled debit cards due to suspected security breach that happened through a malware in the systems of Hitachi Payments Services, which serves ATM network of Yes Bank in October 2016

Cyber Threat Preparedness

•       A high-level Information Security Steering Committee (ISSC) of IDBI Bank ensures that provisions are in place for continued protection of IT resources of IDBI Bank
•      Apart from conducting regular information security awareness programs for the employees, IDBI Bank also communicates with the customers on various Information Security precautions through E-Mail / Mail / SMS
•       IDBI has created a  Captive Security Operations Centre (SOC) 

Conclusion

•        On the whole the digital initiatives taken by IDBI is still in the nascent phase with the other playaers like IndusInd Bank, ICICI Bank and even PSUs like SBI being miles ahead
•       Clear organizational structure for digital transformation has not been created 
•       The digital marketing initiative does not seem to be on the track and the collaboration with FinTechs still not started in the right earnest 
•      The IT architecture is still not conductive for opening up of the Application Program Interface resulting in lack of better collaboration with  partners and customers alike 
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Please connect with the author of the article at jhasumit@gmail.com for any help on digital transformation of Banks.

Bibliography:

http://timesofindia.indiatimes.com/business/india-business/idbi-bank-q3-loss-widens-to-rs-2255-cr-as-bad-loans-soar/articleshow/57019672.cms