With more and more people preferring to skip traditional bank branches, Kotak Mahindra continues to make a push into digital banking, launching an app-based paperless account opening service to rope in new customers.
Kotak Mahindra, India's fourth largest private sector bank, has introduced 'Kotak Now,' which lets customers complete verification formalities following a video call, eliminating the need for a branch visit or a biometric verification. The bank hopes the new service -- which cuts the account opening process from a few hours or days to about seven to ten minutes – will account for at least quarter of its new banking customers in the next month or so, Deepak Sharma, Kotak's Chief Digital Officer, told HuffPost India.
However, according to Sharma, the biggest change in banking in the coming years will be increasing reduction of manual or human intervention, blending automation technologies such as artificial intelligence (AI) and 'Internet of Things' along with human skills. Kotak Mahindra is currently testing AI bots in its Bangalore innovation lab, said Sharma, noting that currently chat-bots tend to be only 50 per cent accurate, but that is set to improve as the bots evolve by learning.
It is also continues to test 'Blockhain', the technology underlying virtual currency Bitcoin, that is currently the buzzword in the financial services industry. Blockchain is essentially a shared ledger of transactions across a network of banks, which cut costs related to settlements and clearances, bypassing the need for governments or any single financial institution.
According to Sharma, an internal deployment of Blockchain is much easier compared to international settlements that require partners.
In the next year, Kotak Mahindra wants to make a further push into "socially-connected" banking services introducing more variants of its digital app products that allow banking through multiple channels, he said.
The bank has seen the adoption of its existing app-based banking services increase three-fold in the past 18 months, said Sharma, "About 50 per cent of banking transactions have moved to digital channels such as online and mobile, with close to 55 per cent of transactions happening on mobile alone," said Sharma.
Its 'Kotak Now' app is the latest addition to Kotak's stable of digital banking products, which also include 'Jifi', a social media-focused banking service that lets customers bank via Twitter, and 'Kaypay,' an social media funds transfer service aimed at e-commerce.
Asked about disruption from non-banking customers, Sharma said emerging fin-tech players "aren't so much of a threat as an opportunity to collaborate," pointing to the bank's backing of fintech startups that focus on business-to-business services such as payments and artificial intelligence.