BOI Guiding Star by Sartaj Mohd Shakeel

Contents

EDITORIAL

Melwyn Rego Managing Director & CEO Bank of India

The Digital Era & The Opportunity Before Banks

NATION & ECONOMY

MANAGEMENT

Dr. Raghuram Rajan Governor, Reserve Bank of India

K. V. Kamath, Former Chairman, ICICI Bank.

RBI’s Annual Report Reassures India's Growth Prospects in 2015-16

The Next Game Changer in Banking & Financial Services Will be Biometric and Communications Technology

VISION INDIA

STAR WAY

Shri. Narendra Modi Hon. Prime Minister of India

B. P. Sharma Bank of India

Our Quest For A Digital India Is All Encompassing

Bank Of India’s Net Profit At Rs. 130 Crore

SPECIAL ARTICLE

Chairman (Non Executive) Bank of India

SPECIAL INTERVIEW Partner, Leader-Banking and Capital Markets Price water house Coopers Pvt Ltd, India

PERSPECTIVE

New Push To Mobile Banking

MEET

THOUGHT WINDOW

Dr. D. K. Srivastava Economist

Rise Of The Middle Class, Poverty Issues and The Need for Social Balancing

Ms. Shinjini Kumar

Moving Towards Digital India: A New Opportunity Era For The Banks

Photo Feature

G. Padmanabhan

Visualising Future Technology Challenges In Banks & The New Role For CIOs

STAR SHOW

N.Chandrasekaran CEO & Managing Director, TCS Ltd,.

The Technopreneur with Creativity at the Top of Business

MARKETING MIRROR Tradition & Culture as Vehicles For Marketing

HEALTH & HAPPINESS Managing Blood Pressure & Leading a Healthy Life

HINDI FEATURE

fo'o fganh lEesyu & nlosa iM+ko dh vksj

Editorial

The Digital Era & The Opportunity Before Banks

t is indeed a great opportunity to communicate with the elite readers of ‘BOI GUIDING STAR’ through this column. It is indeed a welcome feature that the colour and content of Indian banking is changing fast imbibing a plethora of people-friendly measures covering social development and technological transformation. Precisely, the focus is finding effective mechanisms to reach out to the poor and the rural sector besides being responsive to the aspirations of the generation next. While this is sure to bring about positive changes in improving the quality of life for the common man as visualized by the policy makers, the emphasis on digital India and the well structured roadmap for the new technological journey for the country is also expected to effect desirable transformations. The digital opportunity also means a new initiative by the banks refashioning the banking service, products and delivery channels, making the banking operations in the country more and more time and trend-responsive. What is important is the fact that digital banking is not just hype but a honest amalgamation of the service contours of banks connected well with the wheels of technology in a meaningful manner to make off-branch banking operations fast and efficient with a touch of functional sophistication. There are greater expectations on Banks thanks to the rise of new business channels like various technology-based start-ups and e-Commerce enterprises. No doubt, banks have to work hard to bring best of applications in collaboration with technology partners. It is not just making it, but making it happen with high priority for creativity and constant update on the basis of market inventions and customer preferences. It is appropriate that ‘BOI GUIDING STAR’, in this issue, has presented thought-provoking discussions on the emerging digital banking scenario through exclusive interview features with eminent personalities. The Feature bring forth valuable views and prescriptions relevant for bankers, customers and technology service providers and I am sure that Readers will find the analysis interesting. The Issue also has the regular Features. I will be grateful for the Reader's feedback on this issue. With Season’s Greetings, Melwyn Rego Managing Director & CEO

Vol.2 No.3

BOI

A Corporate Thought Magazine From Bank of India

Shri Melwyn Rego Managing Director & CEO

Executive Directors Shri B. P. Sharma Shri Ravindra P. Marathe Shri R. A. Sankara Narayanan

Editorial Board Shri R. N. Kar Chief General Manager (HR) Shri R. C. Baliarsingh Chief General Manager (Retail Assets, Publicity & CSR) Shri B. V. Upadhye General Manager (RMD)

Editor Shri S. M. Shakeel

Content Management & Production BankipediaIndia Research Foundation

Editorial Director V. Gopalan

Design & Visual Effects la Gopa

Editorial Office BankipediaIndia Research Foundation, ‘Sri Krishna’ 24/18, Sankarlal Jain Street Nehru Nagar, Chromepet Chennai 600044 Telefax: 044-22235248 Mobile: 9840028716 email: editorguidingstar@gmail.com

NATION & ECONOMY

RBI’s ANNUAL REPORT REASSURES INDIA'S GROWTH PROSPECTS IN 2015-16 ‘The outlook for growth for Indian economy is improving gradually. Business confidence remains robust, and as the initiatives announced in the Union Budget to boost investment in infrastructure roll out, they should crowd in private investment and revive consumer sentiment, especially as inflation ebbs.’ he Reserve Bank of India’s Annual Report 2014-15 reassures the country’s growth prospects while underlining the need for effectively carrying on the reforms in key sectors.

The just released Report reveals that the macroeconomic environment in 2014-15 was marked by a modest pick-up in activity amidst building internal and external stability, against the backdrop of a tepid and multi-speed global recovery across regions. “Going forward, the economy needs to grapple with significant challenges in the path towards realising its potential and sustaining the growth process. Importantly, structural constraints to growth and asset quality concerns need to be addressed sooner than later”, it adds. The Report highlights vital aspects of the growth journey and the issues before the managers of the economy: “The Indian economy remained resilient in a global environment characterised by falling macroeconomic risks but rising financial stability risks. While a modest recovery is tentatively gaining foothold in advanced economies, activity slowed across a broad swathe of emerging economies as commodity prices fell, financing conditions tightened and structural constraints started building. India is a notable exception.” “Even as banking sector risks remained elevated domestically, the macroeconomic fundamentals of the Indian economy improved

gradually over the year, anchored by some easing of inflation and continuing fiscal consolidation. Notwithstanding deterioration in export performance brought on, inter alia, by weak external market conditions, the current account deficit narrowed in 2014-15 from its level a year ago on terms of trade gains and weak import demand. With fiscal consolidation firmly underway and with buoyant business optimism, the stage is now set for unshackling stalled investments and for boosting new capital spending in order to accelerate the pace of growth. Drawing on the experience of 2014-15, it is now time to implement an agenda to take the economy to higher growth in 2015-16 and over the medium-term. Concomitantly, recent gains in reducing inflation pressures need to be built upon so that disinflation continues along with higher growth. Importantly, resolute actions are needed to ease stress in financial assets, mitigate/ resolve debt burdens so that stranded assets are put back to work quickly wherever feasible and capital buffers are built to enable financial intermediaries to provide adequate flow of credit to productive sectors”. PROSPECTS 2015-16: OUTLOOK FOR GROWTH Turning to 2015-16, the Report mentions that the outlook for the global economy has been adversely impacted by the contraction in output in North America in the first quarter of 2015.” In the second and third quarters, there are indications of demand picking up in advanced economies; however, the continuing slowdown in emerging economies holds back a fuller global recovery. At the same time, with hardening bond yields and risk premia, emerging economies are contending with volatile currency movements and capital flows. Going forward, these factors could pose risks to the global recovery. Accordingly, the IMF has pared its forecast for global growth in 2015 to 3.3 per cent in its July update, marginally lower than in 2014.” The Report reassures that the outlook for growth the Indian economy is improving gradually. “Business confidence remains robust, and as the initiatives announced in the Union Budget to boost investment in infrastructure roll out, they should crowd in private investment and revive consumer sentiment, especially as inflation ebbs. While the progress of the monsoon has

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Dr. RAGHURAM RAJAN Governor, Reserve Bank of India

allayed initial fears of moisture shortfall, uncertainty surrounding the progress and distribution of the monsoon remains a risk to the outlook for both growth and inflation. Comprehensive and pre-emptive food management strategies need to be put in place to contain these spillovers. In the first four months of 2015-16, indicators of real activity have broadly tracked the Reserve Bank’s baseline projection of output growth (at basic prices) at 7.6 per cent for the year as a whole, up from 7.2 per cent in 2014-15”. Taking into account initial conditions, including the prospects for the monsoon and for international crude prices, the Reserve Bank projected in April 2015 a baseline path for inflation in 2015-16 in which it would be pulled down from current levels by base effects till August but is expected to start rising thereafter to below 6.0 per cent by January 2016. So far, inflation outcomes have closely tracked these projections. The risks to this trajectory are balanced as the weatherrelated uncertainties are offset by falling crude prices. Inflation developments will warrant close and continuous monitoring as part of the overall disinflation strategy that requires inflation to be brought down to 5 per cent by January 2017. FISCAL POLICY “As regards fiscal policy, the Government’s resolve on fiscal consolidation should propel efforts to reach the target for the gross fiscal deficit for 2015-16 at 3.9 per cent of GDP. In the early months of the year, indirect tax collections have been robust and set to achieve budget estimates, though contingent upon a recovery in manufacturing and services. Furthermore, plans for disinvestment need to be frontloaded to take advantage of supportive market conditions, and also to forestall cutbacks in capital expenditure to meet deficit targets. Such cut backs compromise the quality of fiscal consolidation. States need to take advantage of the greater fiscal autonomy stemming from higher devolutions and prioritise capital and developmental expenditure so that the quality of subnational fiscal correction is maintained. Referring to the external sector the Report reveals that the merchandise exports have contracted through the first four months of 2015-16, rendering the economy vulnerable to external shocks. Imports have remained subdued, primarily reflecting softening of crude and gold prices. Non-oil non-gold imports have also moderated due to muted domestic

activity. Over the rest of the year, some savings may accrue on account of POL and bullion imports; on the other hand, the gradual pick-up in activity anticipated over the rest of the year may revive non-oil non gold import demand. It further states that the remittances from Indians working abroad have weathered the slowdown in global growth and should continue to lend support to the balance of payments.” Along with a surplus expected on trade in services as in the past, from software exports and travel earnings, the current account deficit for the year as a whole should be contained below 1.5 per cent of GDP. The outlook for capital flows is highly uncertain, with the widely anticipated normalisation of US monetary policy later in 2015 expected to generate capital outflows from emerging markets and also to harden financing conditions as bond yields rise. In this context, the level of reserves at over US$ 350 billion and equivalent of about nine months of imports should provide a buffer and smooth out normal import and debt servicing requirements over the year.” REFORMS HOLD THE KEY The golden lines of the Report is the emphasis on speeding up the reforms programmes to make things happen.”Key to the realisation of these expectations is a durable pick up in investment, supported by sustained efforts to alleviate supply

‘The Report brings to the light the importance of relook to certain aspects like expansion of the avenues for gainful employment opportunities is vital for efforts to harness the demographic dividend’.

constraints. The proposal to introduce a Comprehensive Bankruptcy Code of global standards by 2015- 16 and replacement of the existing multiple prior permission procedure for investments by a preexisting regulatory mechanism is expected to improve the business environment in India. Easing the doing of business has now become a widely cited constraint on the revitalisation of manufacturing. Areas that require significant changes include legal and regulatory environment, labour market reforms, tax regime and administrative environment. Gaps in distribution networks and deteriorating financials of power discoms need to be addressed expeditiously for demand to keep pace with the ongoing easing of supply constraints. Focusing on renewable and clean sources of energy should be accompanied by conservation of energy as a medium-term strategy. DIGITAL INDIA The Report brings to the light the importance of relook to certain aspects like expansion of the avenues for gainful employment opportunities is vital for efforts to harness the demographic dividend. “This calls for careful identification of skill gaps, providing vocational and technical training, and building of new skills. The National Mission for Skill Development which aims at consolidating skill building initiatives spread across several ministries, is relevant in this context. As self-employment holds out greater employment opportunities, the SETU (Self Employment and Talent Utilisation) initiative for supporting all aspects of start-up business and other self-employment activities is crucial. Other initiatives like Digital India and Make in India will also help to enhance the employment potential.”

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VISION INDIA

“OUR QUEST FOR A DIGITAL INDIA IS ALL ENCOMPASSING” Technology can make agriculture productive, prosperous and profitable. We have seen this worldwide. I was happy to know that crores of Indian farmers have been receiving agriculture related information through SMS’. PRIME MINISTER’S VISION FOR A DIGITAL INDIA: High-speed Digital Highways unite the Nation 1.2 billion Connected Indians drive Innovation Knowledge is strength and empowers the People Access to Information knows no barriers Government is Open and Governance Transparent

I Dream of a Digital India

Technology ensures the Citizen-Government Interface is Incorruptible Government Services are easily DQG HI¿ FLHQWO\ DYDLODEOH WR FLWL]HQV RQ Mobile devices Government pro-actively engages with the people through Social Media Quality Education reaches the most inaccessible corners driven by Digital Learning Quality Healthcare percolates right up to the remotest regions powered by e-Healthcare Farmers are empowered with Real-time Information to be connected with Global Markets Mobile enabled Emergency Services ensure Personal Security

where...

Cyber Security becomes an integral part of our National Security Mobile and e-Banking ensures Financial Inclusion e-Commerce drives Entrepreneurship The World looks to India for the next Big Idea The Netizen is an Empowered Citizen

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hri Narendra Modi, Hon. Prime Minister of India, has described technology as a means to “discover, learn, evolve and implement.” His dream and thoughts pins great confidence on the role of the new technology tin transforming India and ensuring all sections of the society a better quality of life. Excerpts from his observations on the Digital India week.

On technology: It (technology) combines 3Ss- speed, simplicity and service. Technology is fast, technology is simple and technology is a brilliant way to serve people. It is also a great teacher. The more we learn about technology and the more we learn through technology, the better it is.” Technology empowers the less empowered. If there is a strong force that bring a change in the lives of those on the margins it is technology. On Technology Technology enthuses the world. I see technology as this vast ocean whose small droplets I have been able to touch upon. Of course, I want to know more and more about latest technology but due to my schedule it becomes very tough. Yet, I am a curious anything that facilitates I try to learn more technology can ensure keep thinking about know as much more

mind when it comes to public good and so, and more about how public good. I it and try to as possible.

At the end of the day, whom are we working for? Who will gain the most from these initiatives-the poor, the marginalised, the neo-middle class. Technology is here to stay. The future of technology lies in its humanization.

innovation. Several big companies today are startups of yesterday.

Technology on a day-to-day basis is getting adaptive to human emotions, preferences and choices. To me technology used wisely is a catalyst to magically transforming the way we live.

We want India to emerge as the Innovation Hub where the next big ideas emerge, driven by the power of technology.

On the Digital India The entire Nation has joined hands to make the dream of a Digital India into a reality. Youngsters are enthusiastic, industry is supportive and the government is proactive. India is yearning for a digital revolution. â&#x20AC;&#x153;The investment committed by industry towards a Digital India indicates their optimism and the positive effects will be felt for generations. Most notably, several job opportunities will be created for our people.â&#x20AC;? On Social Media The future belongs to social media. It is egalitarian and inclusive. Social media is not about any country, any language, any colour, any community but it is about human values and that is the underlying link binding humanity. My being on social media has enriched me in many ways. After a long day at work, I log on to social media and it is very very refreshing. I am active on Facebook, Twitter, Google+, LinkedIn and Instagram. It gives me a pulse of what people think. I get a lot of feedback. For example, someone tweeted to me that during one of the speeches I spoke too fast. It acts as a mirror for all of us in our otherwise very busy lives. I am a firm believer in the use of social media. It has given voice to the common man. This is an empowering platform and it should be used as positively and creatively as possible. That is when you will understand the power of that medium and you will be able to make a difference. On mobile governance M-governance is empowered governance. It has the potential to make development a truly inclusive and comprehensive mass movement. It puts governance into everyone's reach. It puts governance in your hands 24/7. On startups Startups are the engines of exponential growth, manifesting the power of

Shri NARENDRA MODI Hon. Prime Minister of India

Digital India Initiative When the Digital India initiative was launched, the fervour was unimaginable and unprecedented. The investment committed by industry towards a Digital India indicates their optimism and the positive effects will be felt for generations. Most notably, several job opportunities will be created for our people. Never before has something been planned at such a large scale. I want to add that this dream will be fulfilled not by the Central Government or the private sector alone. Everybody (Centre, State Governments, organisations, corporates, people) has to come together and is working towards a digital India. On Digital Utility I want to tell everyone - our quest for a Digital India is all encompassing. It is going to touch your lives in several ways, making it easier. For instance, the Digital Locker and e-Sign will manage all key documents with ease and efficiency. Documents can be accessed at a click and that too without being inconvenienced. Take healthcare-eHospital would mean no more wasting time standing in hospital lines. Instead, there is online registration for appointment, online payment and online reports. The real strength of these initiatives will come when they are extensively used. For instance, think of paying the salary of your support staff from your mobile to their Jan Dhan accounts. Similarly, keep using these services in as many ways as possible. On empowerment Technology empowers the less empowered. If there is a strong force that brings a change in the lives of those on the margins it is technology. It serves as a leveler and a springboard. Take for instance the farmer. Technology can make agriculture productive, prosperous and profitable. We have seen this worldwide. I was happy to know that crores of Indian farmers have been receiving agriculture related information through SMS.

Small entrepreneurs not having abundant capital, get a chance to create value, through technology. Our handicraft workers who were dependent on seasonal tourist flow, can now sell their products across the world with a single click. Aggregators of various kinds have given a fresh lease of life to thousands of people across our country. Be it retail, tourism, transport, food industry, technology has given a new platform to thousands of people, them on the margins. Exuberance and Talent of our youth is finding an outlet of expression through technology. This is not only driven by demand side dynamics but is well complemented by our supply side potential as well. Hence technology is serving as a connecting bridge between our ever expanding consumer market and our demographic dividend. Digital Priorities These 3As are important for a Digital IndiaAccessible, Additive and Affordable. Access is key. We want our 125 crore Citizens to be digitally empowered. We already have broadband usage across India gone up by 63% in the last year. We need to accelerate this further. The government efforts must be complemented by similar energy and proactiveness by other stakeholders. I would also like to see the private sector become part of the efforts to ensure broadband Internet has the widest reach across India. Our digital India initiative is about value addition. It must enrich the lives of the people. It must offer something unique to everyone, which can make a positive difference. Similarly, Affordability is the third key. A product can be accessible and additive but it will never leave the long-term impact until it can be affordable. Because, at the end of the day, whom are we working for? Who will gain the most from these initiatives-the poor, the marginalised, the neo-middle class. In terms of scale, extent and influence, our Digital India initiatives must be path breaking and all inclusive, laying the foundation for how we script Indiaâ&#x20AC;&#x2122;s development story in the 21st Century.

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SPECIAL ARTICLE

VISUALISING FUTURE TECHNOLOGY CHALLENGES IN BANKS & THE NEW ROLE FOR CIOs G. PADMANABHAN Chairman (Non Executive), Bank of India, Former Executive Director, Reserve Bank of India.

‘Though not strictly comparable, one can surmise that the demands on a CIO of a complex bank are akin to those of a CTO of a technology start-up: whether it is in leading innovationproduct and process or managing multiple teams to develop and deliver or focusing on the customer experience or partnering with sales/ marketing to deliver’.

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ho is a CIO? Over the years, the roles and responsibilities of the CIOs have been undergoing a major transformation. Today's CIO has to deal with modern technologies which require a different way of thinking and finding new avenues to lead the changing environment, which may otherwise lead to technological irrelevance. In addition, in the long run, they have to ensure to drive up productivity of the bank while ensuring innovation and security of systems thus playing the role of a Chief Innovating Officer and a Chief Intelligence Officer. Though not strictly comparable, one can surmise that the demands on a CIO of a complex bank are akin to those of a CTO of a technology start-up: whether it is in leading innovationproduct and process or managing multiple teams to develop and deliver or focusing on the customer experience or partnering with sales/marketing to deliver. But of course, as compared to technology start-up CTOs, the bank CIOs have to work in an extremely complex environment and therefore they need to possess multi-dimensional skill sets.

Human capital-the weakest link I would first like to focus on few issues that have relevance for CIOs of banks in the present day context and then leave you all with a set of questions on each of these issues, for you to ponder over in the days to come: By its very definition, Human capital is “the stock of competencies, knowledge, social and personality attributes, including creativity, cognitive abilities, embodied in the ability to perform labour so as to produce economic value”. The challenge, that most institutions including banks face, is realizing this resource to serve its purpose. The future of banking in India, in my view, is going to be driven by critical elements; the most significant among them being human capital and technology in that order. For some years now, we all have been hearing, that Indian banks, especially those in the Public Sector will be facing severe crunch of manpower. To visualise that 60-80% of senior executives, 50% of middle managers and 60% of other staff (which amounts to nearly 1.5 lakh personnel) will be retiring in the next 5 years is indeed a daunting challenge. While it is comforting to note that initiatives are being taken to recruit manpower in larger

The future of banking in India, in my view, is going to be driven by critical elements; the most significant among them being human capital and technology in that order. numbers than before, we need to ponder over the requirements of banks in a changed scenario where both technology and soft skills hold the key to ensuring the achievement of the goals set up by the management. Innovation Innovation leads the way in all industries and banking is no different. With regard to innovation, Satya Nadella, CEO, Microsoft, in his first letter to the Microsoft employees, observed: "While we have seen great success, we are hungry to do more. Our industry does not respect tradition â&#x20AC;&#x201D; it only respects innovation". This is the importance that successful companies give to innovation. I like to cite a few successful examples from industries other than banking. Recently in the news is the case of WhatsApp! It is amazing to note that a company consisting of 55 persons could acquire an intrinsic value of $16 billion in a matter of a few years. Let us understand the innovative capability of the product. It has managed to bring together 400 million users with the help of a smart phone and a simple business plan. Why can't such products be emulated in the banking sector? Are we making available a sound innovation framework, including adequate organizational support? Let us introspect. I am sure it is not easy but should we not at least make the right attempts. We also need to look at customer oriented innovation. Most of the innovative steps taken by banks in the recent past have a bearing on the profitability of banks, on their own operational improvements, better housekeeping and the like. How many of us can look back and identify the innovations which have resulted in customer delight, or if not, at least better customer satisfaction? I am reticent of challenging you openly with this question as I am a little skeptical about the outcome.

A majority of banks have implemented the Automated Data Flow (ADF), a project initiated by the Reserve Bank to ensure smooth and timely flow of quality data from banks to the Reserve Bank.

value is growing, only a tiny fraction of territory has been explored. (b) By 2020, as much as 33% of the digital universe will contain information that might be valuable if analyzed, compared with 25% today.

In the context of data quality, I would urge the stakeholders to deliberate over the following: (a) Do we all understand that in the process of decision making, rather than lack of data, it is inconsistent data which is more painful to handle? (b) Let us not put the blame of poor quality of data on IT; it is the business streams which are more responsible. Do we have a solution to address this problem? (c) Another relevant aspect pertains to data ownership. Who owns the data? Is it IT or the respective business streams in your bank? Who should ideally own this?

How can banks collect this data and churn it to useful information? Do we have right specialists to do this job for us? Can we use technology for transaction pattern analysis and for flagging aberrations? Most importantly, as decision makers or those who facilitate decision making, do we know what data is required and in what form or manner?

Intelligent banking rests on good decision making. In this regard, the presence of a robust DSS that can provide relevant information and analytics based on the available data will be definitely helpful. Sometime back, I came upon a study by IDC on the Digital Universe in 2020. By definition, Digital Universe is a measure of ''all the digital data created, replicated, and consumed in a single year". Their analysis, starting with data collected in 2005, shows a continuously expanding, increasingly complex, and ever more interesting digital universe. In their sixth annual study of the digital universe, they have come out with the following findings: (a) While the portion of the digital universe holding potential analytic

Mobile bankingâ&#x20AC;&#x201C;what's next? The potential of mobile banking as a delivery channel in particular, for financial services is unrivalled in India. The developments in mobile telephony, as also the mobile phone density in the country, with over 870 Mn subscribers, presents a unique opportunity to leverage the mobile platform to meet the objectives and challenges of financial inclusion. By harnessing the potential of mobile technology, large sections of the un-banked and under-banked society can be empowered to become inclusive through the use of electronic banking services. In India, despite high mobile density, it is also a reality that most of these handsets are basic ones and many of these connections belong to the category of prepaid subscription base. These constraints cannot be lost sight if mobile technology has to be harnessed as the

Power of big data At the base of all information processing is data. We are all straddled with huge volumes of data. But they remain mere data which cannot even pass the test of easy comparison across two different systems. The IT Vision 2011-17 document of the Reserve Bank has emphasised the importance of both quality and timeliness of data for MIS and decision making purposes. To achieve this, uniform data reporting standards are of vital importance.

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Special Article medium to deliver basic financial services to large masses. Road to financial inclusion The road to achieving financial inclusion is a long and arduous one, giving one a feeling of ‘running on the treadmill’. When will we get there? Banks, the strategic players in meeting the financial inclusion objectives, are challenged as the outcome has not been proportionate to the efforts made by them. However, this is not to say that we have not seen any measure of success at all. One of the roads to financial inclusion is through the ‘payments’ route. “Payments” as a means of financial inclusion has been empirically tested in many other parts of the world. Towards this end, the Payment Systems Vision of the Reserve Bank, is also focusing on ‘inclusiveness’ of payment services. Complementing this is achieving a ‘less-cash’ (rather than cashless) society which is high on our agenda. Despite the encouraging trends noticed in non-cash electronic payments, the numbers are well-below the potential in the country. Payment services are a classic example of goods where the network externalities are high, and as such it leads to a ‘chicken and egg’ situation in analysing the cause and consequence of low usage of electronic payments. Thus, it would require concerted efforts of the service providers to reach out to customers to provide accessible services and create awareness while customers have to gradually overcome their payment habits, concerns of safety and security etc. The National Payments Corporation of India (NPCI) has been playing out its role as the umbrella organisation for

Most of the innovative steps taken by banks in the recent past have a bearing on the profitability of banks, on their own operational improvements, better housekeeping and the like. 8I

retail payments in the country, non-bank issuers of prepaid payment instruments, cross border fund transfer providers, card payment networks, ATM networks, White Label ATMs etc. Other players such as aggregators and intermediaries, technology providers / processors, BCs etc., should also contribute their might in realising the vision of ‘‘less cash’’ society. Security Issues Information security is another issue that must be very well understood by all institutions including banks. In the last few years, the information systems and the networks of the banks are increasingly faced with security threats from a wide range of sources including computer-assisted fraud, sabotage, vandalism etc. The sources of damage such as the computer viruses, computer hacking and denial of service attacks have become more common, more ambitious and increasingly sophisticated in the networked environment. The evergrowing dependence of organisations on the information systems–and more so when there is outsourcing–has made them more vulnerable to such security threats. A word of caution here: Balance convenience of use of systems and robustness of security measures in them in such a manner that usage does not get complicated. In order to ensure that banks accord appropriate attention to aspects relating to the above, the Reserve Bank has advised banks to take suitable steps to ensure that the issues relating to governance, information security and business continuity get adequate attention at the Board level. Further, banks have also been advised to secure their ISs,

ensure their continuity, and check their robustness, by putting in place appropriate business continuity plans (BCPs). Role of CISO Are our CISOs meeting often to share information relating to information security that may be mutually important to them? After all the chain is as strong as its weakest link and the weakest link here is Information Security- which is most talked about and least appreciated or understood. Recently the Reserve Bank has advised CISOs of banks to share information on security incidents, external attacks, internal compromises on banks’ websites etc. As of now, information sharing among banks on these issues is not very prevalent. Sharing of such information/ incidents/ experiences would greatly benefit banks in taking appropriate preventive/corrective measures. IDRBT has developed a Security Incident Tracking Platform where banks would be able to report security incidents in an anonymous manner; thus keeping the information reported by the banks confidential. The platform will be hosted on the INFINET and the access provided only to Chief Information Security Officers (CISOs) of respective banks. The Bank of England has recently appointed a CISO who is a former policeman and has specialised in fraud and counter-terrorism. Should our CISOs be specialists of this nature? Are we not exposed to similar risks? Is there a need for a formal CISO forum in our country with greater powers including standards setting? I take this opportunity to request the cooperation of all banks in our endeavour to make this happen.

Special Interview

MOVING TOWARDS DIGITAL INDIA: A NEW OPPORTUNITY ERA FOR THE BANKS ‘Banks in India are showing rather agile and proactive response to the digital opportunity and challenge. However, sometimes it appears that they are being defensive in their strategies because there is not enough clarity on how this challenge will evolve’ Guiding Star: How do you look at the present focus on ‘Digital India’? Considering India’s prospects for a higher growth regime for the coming years and the new role of technology based applications in people's social and economic activities in day to day life, what sort of desirable transformations can be expected in the country’s social and economic fabric through the digital platform? Shinjini Kumar: The digital proposition in fact can both fuel that high growth as well as benefit from it. In that sense, it is a virtuous cycle. While it will be relevant to all, in the Indian context, the size and diversity of the economy, combined with the fact that digital connectivity is higher than physical, presents unique opportunity. Digital can transcend traditional barriers to basic health, education, financial services and government programs. However, it is also important that complementary physical infrastructure is put in place. Take the example of health services. Digital can be used to connect the consumer to an ambulance service, insurance and hospital, but the ambulance and hospital must exist and be ready to serve the consumer in need. The absence of that will create larger frustration instead of solution. Most banks have been on the digital journey for years now, but various studies indicate that the journey is only halfway through. Operating agility and cultural changes are next on the agenda for the digital transformation. The question is how to make this happen under the present conditions? Globally, large banks with their legacy systems are finding it a challenge to manage and execute the change to digital culture and operating models. Banks in India are showing rather agile and proactive response to the digital opportunity and challenge. However, sometimes it appears that they are being defensive in their strategies because there is not enough clarity on how this challenge will evolve. The fuzziness around new differentiated banks, role of non-banks or disruptors such as crowd funding platforms should start getting clearer in time, helping them focus and drive their strategies. Also, currently the response is focused on using digital as one more channel and working around processes to accommodate digital. It is possible that

new entrants (or some of the existing banks) will be able to build upon the digital advantage for a smarter and less expensive operating model. The key push factors in the emerging digital challenge for banks are projected to centre around client centricity, open innovation, and organizational flexibility. What in your view should be pattern of approach for large Indian banks with huge geographical and business spread? The large, diverse geography and width actually create the need for looking at the digital alternative for solving problems of access, connectivity and integration. Think about the potential of mobile based solutions that can use translation software for multilingual voice interface or app based selling tools that can empower the channel and consumer without additional infrastructure requirements. “The digital opportunity invites banks for a new commitment to become more client-centric, more tech-savvy, and more inclusive. As the market evolves even more rapidly through the end of the decade, all banks will have to adapt to a disruptive model in people and IT. The two engines of retail banking must fundamentally adapt to deliver the b e s t results.” Comment Given pattern growth India is leading to rapid addition of mid to large size

that the of in not

Ms. SHINJINI KUMAR Partner, Leader-Banking and Capital Markets PricewaterhouseCoopers Pvt Ltd, India

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Highlight Feature corporates and therefore emergence of a large salaried class, financial services will need to rethink the stereotype of retail banking clientele. The young graduate with predictable life cycle needs and aspirations around education, marriage, two children, home ownership, old parents, old age security etc. may be just one of the many customer types for banks going forward. It could quite likely be replaced by a profile that moves from graduation to ten years of struggle with a startup and then wealth and retirement at 35. Or, it could be children after 50 through surrogacy. On the other hand, it could be just millions of people engaged at subsistence level, making small value transactions and channelling savings into health and education for children. This creates the need to ‘’fundamentally adapt”. Fortuitously, digital technologies make that possible at affordable costs of delivery. Technological capabilities are becoming a main differentiator for banks when it comes to improving the customer experience. Leading banks worldwide are creating a smart middleware layer that computes and processes customer and business intelligence with state-of-the-art technologies and interfaces. Do you think that Co-creation and collaboration will be the new mantra for tomorrow’s leading Indian banks? I see that there is going to be no choice. Innovation is not necessarily going to come from the market leaders of today and get built in seamlessly with the existing backend. It will come from anywhere. And that will lead to what is being called the

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line of customers? Is it the arm of marketing or greater operational efficiency that can make this happen in a successful scale?

Innovation is not necessarily going to come from the market leaders of today and get built in seamlessly with the existing backend. It will come from anywhere. ‘unbundling’ of banking, that is, different players will create value in different parts of the value chain. This will create the need to collaborate. Also, innovations from other industries will likely disrupt delivery of financial services, creating the need to co-create. Interestingly in India, co-creation and collaboration will also gain momentum if regulators continue to look at banks as the primary customer ‘trust point’, which is very likely going to be the case. A new face through the digital content is seen as an opportunity to improve the brand image of banks besides gaining a new space in business and avenue for reaching out to a new

Marketing is essentially a double edged sword. It helps create the promise, but if you do not deliver on the promise, the downside may be bigger than you never promised! So, if digital is being used as the marketing mantra (which is not bad at all because we live in a young country with hyper connected people), institutions better back that up with operational efficiency that meets the consumer’s expectation of a digital experience that is as good as what the other digital providers like social media platforms or e commerce are pampering with. The real issue in digital journey by banks is the identification of the right type of technology partners and right ideation on products and services that are customer responsive and reasonably futuristic? Can you indicate an effective road map for large conservative organizations in this regard? I think being large brings certain amount of conservativeness with the territory. You have much to lose and it inhibits the ability to try new ideas or bring in partners that are not already tested. So, what ends up happening is the copycat behaviour wherein everyone chooses the same and effectively back a system where all are vested.

Fortuitously, digital technologies make that possible at affordable costs of delivery This, in turn kills the incentive for further innovation. I recently introduced an innovative start up to a mid-sized bank. The owner, in his twenties, turned up for the meeting in a shirt with sleeves rolled up. I can visualise how that meeting would go in what you are calling a large conservative organization! To cut through this problem, one option is to empower younger people within your own organization to come up with ideas. I often attend meetings where the junior person only speaks when they get the opportunity to say something like, “as Sir/Madam rightly put it…” and then they actually say something quite striking. So, I wonder what it would be like if that person was empowered to choose and experiment and co-create, do pilots and scale up. This is one way. Other ways could be to choose the right advisor who can understand and influence the culture of the organization and bring relevant ideas, not only for technology, but for a supportive organizational culture with it. Changes in the Indian business arena – like Ecommerce, Start-ups, Retail, Telecom – are so fast with far reaching societal implications. As a futuristic person and thought leader, how do you visualize Indian banking, especially in the digital context, five years from now-in the backdrop of the change dimension?

with a grievance redressal mechanism that is not just fulfilling expectations of regulators, but effectively competing to make that a competitive advantage and a selling point. What are the major challenge/risk areas in digital banking, looking from the Indian context? Data security and confidentiality will continue to be a big challenge. When you move money from the pockets of people onto servers of financial institutions, you are shifting the risk from personal to institutional. Trust in the institutions’ ability to guard and protect that value is paramount to further growth and perpetuation of trust. Also, this is not an area where anyone, anywhere can sit back and relax. It is an ongoing battle against the unknown and therefore the ability to invest the right talent and technology and management bandwidth in data governance and information handling will continue to be key. What in your view should constitute the ‘digital vision’ for top managements in banks?

When I started working in this area, the first thing I did was to sign up for a bunch of apps. So, I was suddenly shopping, playing, paying, traveling, learning language and music, doing charity, reading journals, all using my mobile phone. Often, when I talk to senior people, I can see a look of incredulity (‘you are just being the consultant, this is not the way the world is ever going to be’ kind of look). But I went to my native place a small town in Bihar and a young girl looked equally incredulously at me when I told her I was going to the local market to shop. It was all e commerce for her! I think those who have physical infrastructure do not choose digital as intuitively as those who do not. Senior management needs to think about the lesser privileged within and outside of their institutions and how digital would make their lives easier and add value to what they do. This might help bridge the gap effectively. Interview: V. Gopalan

For me, success will be when we are not thinking of creating access, but creating choice. Every consumer, whether rich or poor, needs to be able to exercise the choice of anywhere, anytime and any device. Intangible assets like character or willingness to pay should create access to credit in the same way as tangible assets like collaterals do today. And, hopefully it should happen at a sensible cost structure

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PERSPECTIVE

NEW PUSH TO MOBILE BANKING ‘India’s domestic remittance market is estimated to be about Rs. 800-900 billion and growing. With money transfers made possible through mobile phones, a big chunk of it, especially that of the migrant labour, could shift to this new platform’. n the long run mobile phone will eventually evolve into a full-fledged virtual bank branch and ATM. When the mobile financial services ecosystem matures and the economy becomes cash-less, most of the transactions would take place using mobile wallet.

The new payment banks, once become operational, are expected to make people less dependent on cash and thus going forward. Mobile phone will become the virtual automated teller machine (ATM) and small-payments by cheque-book, which will take care most of basic banking needs such as money transfer, savings and bill payments. According to Shri Jatinder Ahuja, Head of India and South West Asia Business, Amdocs the mobile phones are likely to emerge as virtual bank branch.“In the long run mobile phone will eventually evolve into a full-fledged virtual bank branch and ATM. When the mobile financial services ecosystem matures and the economy becomes cash-less, most of the transactions would take place using mobile wallet.,” Amdocs provides technology and services to mobile operators, banks and financial institutions to offer mobile banking. New Payment Banks The recent push to mobile banking came in the Reserve Bank of India’s in-principle clearance for payment banks. The ‘in principle’ approval for payment came to 11 entities, including well-established corporate houses, Reliance Industries, Aditya Birla Nuvo and Tech Mahindra, as also Airtel and Vodafone. What are they? New stripped-down type of banks, which are expected to reach customers mainly through their mobile phones rather than traditional bank branches.

¡ They

can provide forex cards to travellers, usable again as a debit or ATM card all over India.

¡ They

can offer forex services at charges lower than banks.

¡ They

can also offer card acceptance mechanisms to third parties such as the ‘Apple Pay.’

What is their new role? This is for the first time in the history of India's banking sector that RBI is giving out differentiated licences for specific activities. RBI is expected to come out with a second set of such licences –for small finance banks–and the process for those is in its final stage. The move is seen as a major step in pushing financial inclusion in the country. It’s a step to redefine banking in India. The Reserve Bank expects payment banks to target India’s migrant labourers, low-income households and small businesses, offering savings accounts and remittance services with a low transaction cost. It hopes payment banks will enable poorer citizens who transact only in cash to take their first step into formal banking. It could be uneconomical for traditional banks to open branches in every village but the mobile phones coverage is a promising low-cost platform for quickly taking basic banking services to every rural citizen. The innovation is also expected to accelerate India’s journey into a cashless economy. India’s domestic remittance market is estimated to be about Rs. 800-900 billion and growing. With money transfers made possible through mobile phones, a big chunk of it, especially that of the migrant labour, could shift to this new platform. Payment banks can also play a crucial role in implementing the government’s direct benefit transfer scheme, where subsidies on healthcare, education and gas are paid directly to beneficiaries’ accounts.

Is there ‘dos’ and ‘don’ts’ for them?

Also, this is the first time since banks were nationalized, that private sector business groups have bagged the RBI’s nod for banking services.

Yes indeed. ¡ They

can’t offer loans but can raise deposits of upto Rs.1 lakh, and pay interest on these balances just like a savings bank account does.

Technology Holds the key?

¡ They

can enable transfers and remittances through a mobile phone.

Payment technologies have proved popular in many developing countries.

¡ They

It is widely acknowledged that mobile financial services technology holds the key to make payments successful in India . They are expected to play a key role in the sphere of financial inclusion as well through the platform of higher technology.

can offer services such as automatic payments of bills, and purchases in cashless, chequeless transactions through a phone.

¡ They

can issue debit cards and ATM cards usable on ATM networks of all banks.

¡ They

can transfer money directly to bank accounts at nearly no cost being a part of the gateway that connects banks.

JATINDER AHUJA BOI

Head of India and South West Asia Business, Amdocs

MEET The Technopreneur with Creativity at the Top of Business Chandra is the new name for innovations and success in the technology business world. What makes him great is simple evolution as an extraordinary technopreneur and business leader on a consistent meritorious performance. Natarajan Chandrasekaran, B.Sc., MCA, has been Chief Executive Officer and Managing Director of TCS, is also one of the most respected leaders in the business world is achievements are many. Mr. Chandrasekaran is responsible for formulating and executing the TCS's global strategy and has been at helm of several key strategic transitions. Chandra served as the Chief Operating Officer at Tata Consultancy Services Limited until October 2009 when he became Chief Executive Officer and Managing Director.

He joined TCS on January 27, 1987. Mr. Chandrasekaran received a Master's Degree in Computer Applications from the Regional Engineering College, Trichy, in Tamil Nadu, India in 1986 after obtaining a Bachelor of Science in Applied Science from the Coimbatore Institute of Technology. TCS With revenues of $15.5 billion in 2014-15, TCS is among the fastest growing IT services companies globally with a compounded annual growth rate of 26 per cent over the last three years. The market capitalization of the company crossed USD 80 billion during 2014-15, making TCS the most valuable company in India. With over 319,000 consultants, TCS has become the largest private sector employers in India with the highest retention rate in a globally competitive industry. Under his guidance, TCS has refined its corporate sustainability program to focus on education, environment and wellness. The firm has created healthcare solutions for charitable hospitals to help them to improve the level of patient care more effectively and use their resources to treat more patients who cannot afford healthcare. Tireless Traveller A tireless traveller who is always willing to meet customers, Chandra personifies TCSâ&#x20AC;&#x2122; commitment to its culture of customer centricity, its

N. CHANDRASEKARAN, CEO & Managing Director, TCS Ltd,.

reputation for high service quality as well as its tradition of innovation. A creative technopreneur known for his ability to make big bets on new technology, Chandra has been driving several innovative initiatives at TCS, some of which have since scaled into sizeable new businesses. Chandra has been appointed as the of the IT Industry at the Economic Forum, Davos 2015-16. He is also member of Indoâ&#x20AC;&#x201C;US CEO Forum. Chandra has been playing an active role in helping the Indian government expand trade and enhance business relationships with several countries. He is part of the bilateral business taskforces for Australia,

Chairperson World for a

Looking at the Issue Through Multiple Lenses is Helpful in Reaching the Right Decision Did you think when you joined TCS that you would get to this position this fast?

Looking back to more than two decades of service, what comes to your mind?

N. Chandrasekaran: I feel privileged by the opportunity to lead a great company such as TCS. Every position I have ever held in TCS has been an end in itself full of rich experiences and learning and not the means to an end. When I joined the organisation 23 years ago, I did not specifically think about reaching this position.

I look at my career as a journey where every situation, every assignment has enabled me to learn something new.

What in your view, are the prime qualities a business leader should possess ? Today’s leaders have to be agile in thought and action. Operating in a rapidly changing and volatile economic environment means there may often be a need to carry out course corrections, especially in the context of a global business. Another important quality is the ability to listen and accept feedback and contrarian opinions and perspectives. More information may not always help you make a better decision, but looking at the issue through multiple lenses is helpful in reaching the right decision. There is a view that it’s easier for professionals in the IT segment to get to the top. Is it correct ? The sustained high growth rates secured by the Indian information technology industry over the past two decades has created many leadership positions across organisations. Moreover, the nature of the industry has given young managers exposure to global customers and global competition early in their careers. This has helped in the grooming of the current breed of young leaders in this industry.

Who have been a great source of inspiration and support at the personal and professional march ? Personally, my parents, who instilled in me the values of perseverance and integrity. Professionally, many people have made an impression on me. Even today, I am influenced daily by the colleagues around me, who bring to the table fresh ideas, new ways of thinking and multiple perspectives. Reaching at the top with challenging responsibilities how do you manage a satisfactory work-life balance? I have always believed that you can find the time for the things that you really want to do. I took up long-distance running in 2007. Now, despite my hectic travel schedule, I manage to run regardless of where I am in the world and what time zone I am in. Similarly, with the other things that I want to do, whether it is being with the family or watching a movie, I find the time to do it; it’s a matter of being clear about what you really want and then making sure it happens. As a family, how do you relax and what are your preferences for leisure ? As a family, we like the outdoors; we go on treks and other nature-led holidays. I enjoy classical music, chess and Tamil literature.

Operating in a rapidly changing and volatile economic environment means there may often be a need to carry out course corrections, especially in the context of a global business. Brazil, Canada, China, Japan and Malaysia. He is also a Member of the Honorary Committee of European Business Summit. Chandra served as the chairman of NASSCOM, the apex trade body for IT services firms in India in 2012-13 and continues to be a member of its governing Executive Council.

(BMA). He was named the ‘Best CEO’ in the Technology, IT Services and Software sector in the Institutional Investors’ 2013 Annual All-Asia Executive Team Rankings. He has also been named one of STEMconnector’s ‘100 CEO Leaders in STEM.’ Forbes India recognised him as their ‘CEO of the Year’ in 2012.

Awards Chandra has received several awards and recognition in the business community in 2014-15. Chandra was awarded the ‘Management Man of the Year’ (2013) from the Bombay Management Association

Chandra was conferred with the honorary doctorate by JNTU, Hyderabad, India (2014). He has received Honorary Doctorate from Nyenrode Business Universiteit, Netherland's top private business school (2013). Chandra has

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also been conferred honorary degrees by many Indian universities such as the Gitam University, Vishakapatnam, Andhra Pradesh. (2013) KIIT University, Bhubaneswar, Odisha (2012); and the SRM University (2010), Chennai, Tamil Nadu. Beyond office, Chandra is an avid photographer, music aficionado and a passionate long-distance runner who has completed marathons in Amsterdam, Boston, Chicago, Berlin, Mumbai, New York, Prague, Stockholm, Salzburg and Tokyo.

MANAGEMENT ‘THE NEXT GAME CHANGER IN BANKING & FINANCIAL SERVICES WILL BE BIOMETRIC AND COMMUNICATIONS TECHNOLOGY’ ‘Technological innovation played a pivotal role in expansion, as banking services such as cash management, foreign exchange and trade finance underwent a major change imparting greater efficiency to both banks and corporate houses. Channels of banking also saw a paradigm shift with increasing use of channels other than the branch.’ echnology pervades through every aspect of economic activity. The rise of communications technology was led by the increasing use of the handheld device with the spectacular growth in mobile telephony and increased connectivity. India is home to the third largest internet user base at about 100 million and has the second largest mobile subscriber base of over 800 million. While the number of internet users is increasing at an annual rate of over 20%, the number of mobile internet users has more than doubled indicating the increasing usage of mobile phone as a means of internet access. The mobile phone is now well equipped with state of the art specifications and has the capabilities of the desktop and the laptop both in terms of communications access and as a computational tool. A decline in device costs will make more and more capabilities available at costs that are within reach of a large section of the population. Broadband connectivity will be the catalyst to multiply the social and economic impact of the evolution in communications technology. The increase in computing power accompanied by reduced costs makes the future biased towards a “digital, mobile and personalised” world.

wireless communications technology for carrying out transactions and maintaining seamless records at both the service provider end and the customer end, will rapidly accelerate financial inclusion, transform the customer's engagement with the financial system and enhance the efficiency of the financial system. The Indian banking sector has mirrored the country’s gradual emergence as an economic powerhouse over the last

Customer's Passport Biometric technology will change the way customers access financial services-the thumb would become the customer's passport into the financial world. Similarly, wireless communications technology means that a small personal portable device, maybe a mobile phone, can be used to carry out transactions and seamlessly connect with the financial services provider's backend systems. The combination of biometric technology for authentication,

K.V. KAMATH President, New Development Bank, BRICS Former Chairman, ICICI Bank.

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The potential that we have today needs significant efforts to be fulfilled successfully and that the process of building the nation must continue. two decades. The sector has undergone a transformation over the last two decades, with the adoption of technology, development of new products and creation of alternate banking channels to serve customers and can today drive inclusive growth.

a spurt in consumption demand. Shift in income levels and lifestyle will lead the Indian consumer

Major Trend

Channels of Banking Technological innovation played a pivotal role in this expansion, as banking services such as cash management, foreign exchange and trade finance underwent a major change imparting greater efficiency to both banks and corporate houses. Channels of banking also saw a paradigm shift with increasing use of channels other than the branch. Technology has been an important disrupter in enabling the emergence of these alternate channels of banking. While bank branches continue to be key sales and service points, alternate channels such as ATMs, point-of-sale terminals and internet banking continue to grow their share of transactions. India now boasts of more than 80,000 ATMs, and this number is growing further. Indian banks have developed the technological capability to handle large volumes at a lower cost than their global counterparts. The level of functionality being delivered through these alternate channels has gone well beyond the balance enquiries and cash withdrawals, to extend to remittances and payment solutions as well. Growth Push Economic growth leads to a demand for better services, better infrastructure and

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The next game changer in banking and financial services will be biometric and communications technology.

to fulfil his aspirations at a younger age with an optimal combination of debt and equity. With income levels poised to improve further and the favourable demographic profile ensuring that a large proportion of the population is in the economically active working age group, consumer finance will continue to grow in the coming years. Similar to those in banking, the trends of development and sophistication are evident across the spectrum of financial services, including insurance and asset management. We are seeing a variety of new product offerings and innovative methods of distribution fostering robust growth in these areas.

One major trend going forward would be the replacement of cash and cheques by electronic payments. India with its proven ability to quickly adapt and leapfrog technology has already started seeing the emergence of electronic cash as a medium of exchange. Currently, around 250 million credit and debit cards issued by banks are in active use. Electronic payments in fiscal 2011 grew to around 955 million transactions valued at USD 7.5 trillion (excluding interbank transactions). This indicates the potential impact of technology on the way money is handled in the country. For large value transactions, systems like real time gross settlement (RTGS) are already fast replacing paper instruments, but small value transactions are still undertaken in cash. Developments in payments will lead to shift of small value payments to electronic channels, as technology reduces the cost of low value transactions. The rapid shift towards electronic payments would require Indian banks to continuously innovate and increase investments in technology to further leverage alternate channels through technological innovation. The use of handheld devices for banking is set to grow exponentially. It is estimated that mobile internet users will touch 200 million by 2015.

The inter-bank mobile payment system (IMPS) operated by the National Payments Corporation of India (NPCI) permits payments with the use of the recipient’s mobile phone number. This system offers promise in wider applications for low cost electronic payments for the inclusion agenda as well as for merchant and business payments where additional transaction information is required. Technology such as small card readers that enable mobile devices to accept credit and debit cards will lead to a multifold increase in acceptance and usage of card based payments further reducing the need for cash. Banks are also exploring new payment mechanisms with the use of secure near field communication (NFC) chips and the use of bar codes for exchange of transaction information without the need of carrying a physical card. Mobile banking will thus further evolve not only as a cost effective channel, as the cost of a transaction through a branch is roughly fifty times more than through a mobile, but also serve across the spectrum as a tool for catering to services such as travel and utility payments and remittances. The rapid growth of mobile connectivity, dropping costs of bandwidth, declining costs and growing functionality of handheld mobile communications devices, the ability of UID to serve as the authentication basis for transactions and the growing volumes of electronic payments–will all set the stage for a paradigm shift in banking. Breathtaking Impact The speed of adoption to newer technological means and its impact has been breathtaking and as India continues to grow, technology will be a force for disruptive change. The scale of opportunity will dramatically change given that the economy would double every five years at least for the next two decades; there is thus a significant opportunity to leverage technology to drive new business models. The next wave of evolution would be the impact of technology on driving an inclusive transformation: not only as a multiplier of productivity but also towards democratising access to information, goods and services, and driving the inclusive agenda by facilitating savings, investments, remittances and spending for a large unbanked population of 700 million people. It is important to realise that the potential that we have today needs significant efforts to be fulfilled successfully and that

The India's growth story is based on multiple pillars: consumption, investment, domestic demand, global competitiveness, knowledge based businesses and industrial growth. the process of building the nation must continue. For instance, the demographic dividend to translate into a significant push to the economy needs to be accompanied with skill development, which is currently at inadequate levels. Though over 90% of new entrants into the workforce are literate today, the institutional capacity for providing skill training is insufficient. The challenge today is in terms of upgrading skills and meeting industry requirements. Both the private and the public sector have to jointly provide wide-scale vocational training to quickly enhance capabilities of people. Enhanced Focus In recent years, there has been enhanced focus on inclusive growth and financial inclusion as a key ingredient of inclusive growth. Financial services remain underpenetrated in India, with substantial scope to increase access to financial services across the country, especially in rural areas and among low income households. In the past, a key challenge was the high cost of delivery of financial services through traditional brick-and-mortar structures. Two key developments have changed this paradigm. First, regulations have been introduced permitting delivery of financial services through business correspondents. Second, the development of technologies using smart cards and biometrics has changed the way banking services can be accessed by the customers. Inclusive growth is not just about subsidies or unemployment benefit schemes–at its core it is about building capacity in the

poorest communities in our country to lead productive lives and earn a decent livelihood. Investment in basic health care, primary education and vocational training are critical to making this happen. Transformation India has made remarkable progress over the last two decades and is viewed today as a land of opportunities. This transformation had its genesis in the process of economic reforms initiated in the 1990s, which unleashed the entrepreneurial abilities of India’s people. In addition to opening up to global competition, the transition resulted in a positive structural shift within the economy. It saw the rise of a strong services sector, the growth of new industries like information technology (IT) and biotechnology, and pushed traditional sectors like pharma and automobiles to become globally competitive. Among the many transformational developments of these years, The India's growth story is based on multiple pillars: consumption, investment, domestic demand, global competitiveness, knowledge based businesses and industrial growth. India’s key competitive strengths lie in a large domestic consuming market with a favourable demographic profile, an entrepreneurial talent pool with innovation capabilities, cost advantage and potential for improvement in productivity with easing structural bottlenecks. There is perhaps no better time than now to enter the corporate arena in a country well on its way to graduate to an economic superpower.

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BANK OF INDIA’S NET PROFIT AT RS. 130 CRORE ank of India has posted a net profit of Rs.130 crore for the quarter ended June 30, 2015 while operating profit stood at Rs.1704 crore. The net interest income of the bank stood at Rs.2,913 crore while non-interest income was at Rs.840 crore as on June 30, 2015. As of June 30, 2015, Bank has a network of 4,907 Branches and 7,479 ATMs, with increase of 232 Branches and 2,447 ATMs over 30.06.2014. The Bank’s retail advances grew 20.69% as the total domestic advances increased from Rs.2,62,874 crore in June 2014 to Rs.2,80,986 crore in June 2015. CASA Deposits increased from Rs.1,05,589 crore in June 2014 to Rs.1,15,737 crore in June 2015. (YoY growth: 9.61%). CASA% increased from 28.40% in June 2014 to 31.67% in June 2015. Savings Deposits increased from Rs.85,815 crore in June 2014 to Rs.96,361 crore in June 2015. (YoY growth: 12.29%). The Bank’s Global Business increased from Rs.8,82,441 crore in June 2014 to Rs.9,03,874 crore in June 2015. (YoY growth: 2.43%). Global Deposits increased from Rs.5,00,875 crore in June 2014 to Rs.5,08,260 crore in June 2015. (YoY growth: 1.47%). Global Advances increased from Rs.3,81,566 crore in June 2014 to Rs.3,95,614 crore in June 2015. (YoY growth: 3.68%). The International Business of the bank increased from Rs.2,39,113 crore in June 2014 to Rs.2,46,528 crore in June 2015. (YoY growth: 3.10%). International Deposits increased from Rs.1,19,421 crore in June 2014 to Rs.1,31,900 crore in June 2015. (YoY growth: 10.45%).

B B. P. SHARMA The then CEO & Managing Director, Bank of India, announcing the business results

Bank of India received “Best MSME Bank” and “Best Bank for operational performance” awards from CIMSME. Bank received “Financial Inclusion & Payment System Award” by Elets Media. Bank received “PMJDY Excellence Award”. The Bank also received IBA Award for “Best Financial Inclusion Technology Initiative” from IDRBT. Bank won IT excellence award by ETNOW and VMWare for effectively implementing Virtualization in the Bank. 18

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The Global NIM stood at 2.12% and Domestic NIM stood at 2.52% in June 2015.Yield on Advances (Global) stood at 8.32% and Yield on Advances (Domestic) stood at 10.79% in June 2015. Cost of Deposits (Global) stood at 5.46% and Cost of Deposits (Domestic) stood at 6.99% in June 2015. Cost to Income ratio stood at 54.59% in June 2015. Capital Adequacy Ratio of the Bank under Basel III is 10.75% as on 30.06.15.Tier I CRAR is 8.23% as on 30.06.15. Tier II CRAR is 2.51% as on 30.06.15. The Gross NPA ratio stood at 6.80% in June-15 as against 5.39% in Mar-15. Net NPA ratio stood at 4.11% in June-15 as against 3.36% in Mar-15.Provision Coverage Ratio stood at 52.15%. The Bank received “Best MSME Bank” and “Best Bank for operational performance” awards from CIMSME (Chamber of Indian Micro, Small & Medium Enterprises). Bank received “Financial Inclusion & Payment System Award” by Elets Media at New Delhi at the hands of Minister for Rural Development.

In emerging market and developing economies, macroeconomic policy space to support demand is generally more limited but should be used to the extent possible.

In A Nutshell Profitability (Q1-2015–16): ¡ Net

Profit Stood at Rs. 130 Crore

¡ Operating Profit stood at Rs. 1,704 Crore ¡ Net interest Income stood at Rs. 2,913 Crore ¡ Non-interest Income stood at Rs. 840 Crore.

Global Business ¡ Global Business increased from Rs. 8,82,441 Crore in June 2014 to Rs. 9,03,874 crore in June 2015. (YoY growth: 2.43%) ¡ Global Deposits increased from Rs. 5,00,875 crore in June 2014 to Rs. 5,08,260 crore in June 2015. (YoY growth: 1.47%) ¡ Global Advances increased from Rs. 3,81,566 crore in June 2014 to Rs. 3,95,614 crore in June 2015. (YoY growth: 3.68%) Domestic Business ¡ Domestic Business increased from Rs. 6,43,328 crore in June 2014 to Rs. 6,57,346 crore in June 2015. (YoY growth: 2.18%) ¡ Domestic Deposits declined from Rs. 3,81,454 crore in June 2014 to Rs. 3,76,360 crore in June 2015. (YoY growth:-1.34%). ¡ Domestic Advances increased from Rs. 2,61,874 crore in June 2014 to Rs. 2,80,986 crore in June 2015. (YoY growth: 7.30%) International Business ¡ International Business increased from Rs. 2,39,113 crore in June 2014 to Rs. 2,46,528 crore in June 2015. (YoY growth: 3.10%)

¡ International

Deposits increased from Rs. 1,19,421 crore in June 2014 to Rs. 1,31,900 crore in June 2015. (YoY growth: 10.45%).

¡ International

Advances declined from Rs. 1,19,692 crore in June 2014 to Rs. 1,14,628 crore in June 2015. (YoY growth:-4.23%)

CASA ¡ CASA

Deposits increased from Rs. 1,05,589 crore in June 2014 to Rs. 1,15,737 crore in June 2015. (YoY growth: 9.61%) ¡ CASA% increased from 28.40% in June 2014 to 31.67% in June 2015. ¡ Savings Deposits increased from Rs. 85, 815 crore in June 2014 to Rs. 96,361 crore in June 2015. (YoY growth: 12.29%) ¡ Current Deposits declined from Rs. 19,775 crore in June 2014 to Rs. 19,376 crore in June 2015. (YoY growth:-2.02%) Asset Quality NPA ratio stood at 6.80% in June-15 as against 5.39% in Mar-15. ¡ Net NPA ratio stood at 4.11% in June – 15 as against 3.36% in Mar-15. ¡ Provision Coverage Ratio stood at 52.15% ¡ Gross

Capital Adequacy Ratio ¡ Capital Adequacy Ratio of the Bank under Basel III is 10.75% as on 30.06.15 ¡ Tier ¡ Tier

I CRAR is 8.23% as on 30.06.15 II CRAR is 2.51% as on 30.06.15

Branches & ATMs (Domestic): ¡ As of June 30, 2015, Bank has a network of 4,907 Branches and 7,479 ATMs, with increase of 232 Branches and 2,447 ATMs over 30.06.2014. Important Ratios (Q1 – FY 2015 – 16): NIM stood at 2.12% and Domestic NIM stood at 2.25% in June 2015. ¡ Yield on Advances (Global) stood at 8.32% and yield on Advances (Demotic) stood at 10.79% in June 2015. ¡ Cost of Deposits (Global) stood at 5.46% and Cost of Deposits (Domestic) stood at 6.99% in June 2015. ¡ Cost to income ratio stood at 54.59% in June 2015. ¡ Global

Awards & Accolades: ¡ “Best

MSME Bank” and “Best Bank for operational performance” awards from CIMSME (Chamber of Indian Micro, Small & Medium Enterprises).

¡ “Financial

Inclusion & Payment System Award” by Elets Media at New Delhi at the hands of Minister of Rural Development.

¡ “PMJDY

Excellence Award’ Honorable Union Minister

from

¡ IBA

Award for “Best Financial Inclusion Technology Initiative” from IDRBT.

¡ Bank

won IT Excellence award by ETNOW and VMW are for effectively implementing Virtualization in the Bank.

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Shri B.P. Sharma, the then Managing Director & CEO, Bank of India, presented a dividend warrant of INR 214.18 crore for the financial year 2014-2015 to Shri Arun Jaitley, Honorable Finance Minister of India, in a formal event held in New Delhi on 31st July 2015. Shri Anant Upadhyay, the then General Manager & CFO and Shri D.K.Garg, General Manager, National Banking (North-I) Bank of India were also present on the occasion.

Star Show Shri Jayant Sinha, Minister of State for Finance, Govt of India & Secretary, Ministry of Finance Shri Hasmukh Adhitya along with the then MD & CEO Shri B P Sharma at the launch new design of Cheque introduced by the Bank. (RtoL) ED Shri R P Martahe, the then MD & CEO Shri B P Sharma, Minister of State for Finance, GOI Shri Jayant Sinha, Secretary MoF Shri Hasmukh Adhiya, GM Shri S R Meena, AGM Dr. Saanjiiv Pathak

The then MD & CEO Shri B P Sharma inaugurating APMC Market Vashi Turbhe Branch at Navi Mumbai Zone. General Manager Shri S C Sarangi, General Manager NBG (W-1) Shri A K Azad & Zonal Manager Shri G H Sarangi with other officials.

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‘Taarangan’ conferred with “Runner- up Trophy” under Best Special Edition category at ICE (In-house Communication Excellence) Awards 2015 held at Mumbai by prestigious Shailaja Nair Foundation, Mumbai. (RtoL) CGM (HR) Shri R N Kar, ED Shri R A Sankara Narayanan, MD & CEO Shri B P Sharma, ED Shri R P Marathe, Editor Shri S M Shakeel, CGM Shri R C Baliarsingh, GM Shri S R Meena, DGM (HR) Smt. K R Srimathi at Head office.

The then MD & CEO Shri B P Sharma inaugurating RSETI, Dhar at Ujjain along with District Collector Smt. Jaishree Kivayat. Also seen in the picture are General Manager NBG (C) Shri T Sudhakar & other dignitaries.

ED Shri R P Marathe addressing the 51st Meeting of State Level Bankers Committee at Ranchi. Chief Minister of Jharkhand State Shri Raghubar Das, GM NBG (J&C) Shri I M Malik and Zonal Manager Shri Shankar Prasad participated.

Shri R A Sankara Narayanan has taken charge as Executive Director of the Bank w.e.f. 15th May, 2015. Earlier he was Chief General Manager (International) in Bank of India. He had joined the Bank as a Direct Recruit Officer (DRO) in 1983. A post graduate, MBA and a Certified Associate of the Indian Institute of Bankers (CAIIB), he also has a Diploma in Treasury and Risk Management and P G Diplomas in Personnel Management and Financial Management. He was elevated as a General Manager of the Bank in September 2011 and was overseeing the International operations of the Bank, covering 59 offices in 22 countries and contributing 29% of the Bank’s business. Over a fast-growth career spanning 32 years in Bank of India, he has held multifarious roles such as Head, Treasury operations, Zonal Manager, General Manager, National Banking Group and at Corporate Office etc., besides 2 foreign stints at Tokyo and Singapore.

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I 21

Thought Window ‘RISE OF THE MIDDLE CLASS, POVERTY ISSUES AND THE NEED FOR SOCIAL BALANCING’ Dr. D. K. SRIVASTAVA

‘It is important to realize that a large segment of middle class started off poor and toiled hard to come up in life awaiting for new avenues of growth. They are strong part of a cultural system based on values.’

Economist

uiding Star: The middle-class becomes more and more economically relevant today because of their enhanced power to save and spend?

Dr. D. K. Srivatsava: That is true. The point is that a large portion of income is being concentrated in the hands of the middle class, mostly in the urban areas. Therefore, their consumption pattern has significant structural impact. The middle class is contributing to the overall saving performance of the economy. The household savings have been growing over time. It is the main surplus sector. This surplus is absorbed by the financial sector and industry. The household saving rate has increased dramatically from around 6 per cent in 1950-51 to about 24 per cent at present. This saving becomes available for absorption by industry, commerce etc., through various avenues. This is how the investment is increasing without putting pressure on interest rates. This becomes more and more significant in the light of the growing capability of the middle class to raise their income levels. These factors bring into focus the new dimension of the power of middle class, which will have a vital role to play in India’s growth. The Indian middle-class is often termed as recognized as an ‘economic power house’ putting the country on a new mode of hope for a much awaited era of growth and welfare. How do you analyze this situation? Well, the Indian middle-class is unique in several aspects. The middle class is unique in terms of high income, high share of the population and high level of average education. It is well informed and is highly motivated to put its children in education if it is not available in India, they send them abroad. In other

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developing countries, this kind of social drive for knowledge cannot be found. It is a unique feature in India. It is important to realize that a large segment of middle class started off poor and toiled hard to come up in life awaiting for new avenues of growth. They are strong part of a cultural system based on values. Their intellectual capacity is at par with the advanced sections of people with solid social standing. This is again a special feature of Indian middle class. Further, the middle class is both saving and consuming. If consumption is not up to the mark, there will be excess production and glut in the market contributing to a chain of difficult fallouts. Therefore, we need to have a proper balance between growth in consumption and growth in saving. With greater realization that the middle-class is poised for a crucial role in the country’s economic onward march, what kind of policy steps and programmes needed to make them a dynamic contributor? Well, the government has to have a clear policy for developing the social infrastructure, which means that it must invest far more in both health and education. As far as the education sector is concerned, the government expenditure is far less than what is desirable. It is clear the need of the hour is income and productivity-related changes come through investment in education. When we say education, it should cover both its width and length. It must cover a very wide canvas and at the same time create islands of excellence. I mean that it must cover a large portion of the population and must go up to the highest levels of specialization. So, it is required to increase the coverage of education though there is also the need to increase the quality

of education by investing in research and development and higher education. Even though partly higher education can be financed by the middle class and resourceful sections of the society themselves, a significant amount of government investment will be required. The same is the story with the health sector. The condition is that the progress of middle class leads only to progress in metro and urban infrastructure and social systems. It does not aim much to reach the rural sector? Yes. The issue should be understood in a proper perspective. We are facing a major problem with regard to the rural population. Their share of agriculture has already come down to 20 per cent. This 20 per cent is growing at 2 per cent while the remaining 80 per cent is growing at 9 per cent. Therefore that 80 per cent, after ten to fifteen years might become 95 per cent or so and the 20 per cent share of agricultural GDP might become 5 per cent or so. However the rural population, which is now at 72 per cent will probably come down to 60 per cent at that time. The conflict here is that the 60 per cent of rural population will be sharing the 5 per cent of GDP. This will take about 10 to 15 years in the future. On the other hand, the 40 per cent of urban population will have a command over 95 per cent of the GDP. This is a major problem,

which requires to be addressed. It may require well-considered economic and social programmes for balanced growth. It is a matter of top priority to effect time bound strategies for rural development and catering to the needs of the poor. The talks of urban versus rural or middle class versus the poor is meaningless if we are to understand the need to work for harmonious elevation of all sections of people in terms of better quality of life and opportunities for moving forward. Indiaâ&#x20AC;&#x2122;s potential to emerge as a fast growing economy in the world and the rise of middle-class warrants proper understanding on the part of economists, policy makers and sociologist to think in the lines of social balancing to protect the interest of the rural sector and the rural poor? There is no doubt about it. I would say that policy makers are well aware of this issue and concepts like inclusive growth are outcome of such understanding. But, there has to be greater realization of this

issue as social balancing is an essential aspect for meaningful growth. I am happy about the revival in economic growth and the emergence of Indiaâ&#x20AC;&#x2122;s middleclass as a growth propeller. I am certainly concerned about the difficulties in the rural areas and the continuing problems of the poor. It is important to work on appropriate balancing measures so that the country makes wellbalanced progress in the years to come. What we need to do? There are many aspects to attend to. Let me pin point a few: It is important to create profitable avenues for the agriculture-based rural youth and other depressed sections. Unless this is done through well-planned rehabilitation programmes, it is likely to result in serious social problems. I would like to insist that education and proper training is necessary for improvement of social conditions. It is also important to bring in new technological tools and information technology for rural transformation. It is likely that future agriculture will see reduction in the number of farmers on the field as a result of introduction of new and better technological tools and rural youth switching over to urban jobs. The key issue is increasing agricultural productivity and enhancing the income and quality of life for the rural people.

There has to be greater understanding of this issue as social balancing is an essential aspect for meaningful growth BOI

I 23

Marketing Mirror

Our family system is one of the living branches of tradition. The Indian tradition about family and family values comes as a powerful route to imaginative marketing and advertising campaigns.

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ecent trends indicate that marketing experts and brand managers find Indian culture and value dimensions provide immense scope to initiate new and people-reaching marketing strategies. The deep cultural affiliations and high family value cherished by vast sections of Indian population across the country is considered as an unique Indian proposition. It is a great strength of the social fabric of India that even the vast sections of our younger generation are also well-connected to cultural priorities. Culture in the Indian context comes deeply coated to the inner personality of individuals. No surprise that various modes of marketing PR exercises by corporate keep the cultural coverage as a top agenda. It is now increasingly emphasized that proper understanding on cultural aspects have to be considered at the time of building new product campaigns and brands building. The duet of creativity and culture is recognised as a prime factor in formulating effective marketing decisions to penetrate in the market. How do we make it? It calls for a path of co-journey involving creativity and culture to participate, penetrate and make useful gains in moving forward in marketing strategies through the ambit of well-cherished culture and values of the country.

Culture & Consumer Consumption decisions made in the market cannot be viewed as an independent eventâ&#x20AC;&#x201C;these are closely related with values and social relationship and cultural allegiance. According to past research, national culture has considerable influence on consumer behavior. National culture of any country, as outer stimuli, influence on the diffusion of products across countries. With globalization, culture becomes predominantly important strategic issue in market that has to be faced and properly managed. Thompson and Rayner (1998) expressed their view about culture in a two-by-two matrix. In this model four competing world views were presented. These are combined with models of cultural solidarity and social organization. These two are based upon particular myths of nature and prescriptive. Strategists point out that India, as a country, is so heterogeneous in nature that it is complex for a marketer to identify common threads of Indian culture and core values. Even though the ever flowing cultural fountain of the country is of a great unifying national character, its regional and local variations are not static but impressively dynamic, adding strength to the cultural mainstream of the Nation. There are many different sub-cultures coexist in Indian society with their own distinctive values, norms, beliefs and behaviours.

‘Certainly culture and arts are close to everyone in the modern society because of its intensive potential to meet ones personal ethos and artistic preferences’ Tradition has the power to connect the past and the present. Our family system is one of the living branches of tradition. The Indian tradition about family and family values comes as a powerful route to imaginative marketing and advertising campaigns. The high place for fathermother, the romantic young couple, the love and care for children comes as big idea for many marketing initiatives. Equally the dream of marriage, quest for education, power of festivals etc also has its impact. The scope for cultural marketing is tremendously increasing during the past decade with events, melas and festivals encompassing various impressive faces of Indian fine arts and culture assuming greater dimension. For example the Annual Classical Music Festival in the South has transformed as biggest event, even bigger than the famous Cannes festival. The recent rush by corporate in sponsoring such culture-centric events is a well-calculated move to gain from increasing public participation in such occasions. What makes flavour of culture and branches of Indian traditional arts catch the large sections of people, giving them feel of happiness and content? Certainly culture and arts are close to everyone in the modern society because of its intensive potential to meet ones personal ethos and artistic preferences.

Psychologists insists that there is an artist in the inner personality of every human being and ventilation to arts, culture, music, dance or drama instantly pleases all. The social tensions and problems of modern life brings many to spiritual solutions as well. Here the spiritual route to values and yoga also sets in. The electronic media has contributed substantially to the popularity of the Chennai Music Festival besides the Channels themselves organising and sponsoring various festivals. The daily telecast of ‘Kalyana Utsvam’ from Tirumala Sri Balaji temple is one of ‘hit programmes’ seen by a large audience in India and abroad. In fact there are many other such cultural festivals serving as platform for corporate marketing campaigns. The thrust on education, the strong hunt for newer technological tools and innovations, the mobile mania, lifestyle comforts and so on are desirable repercussions from the cultural strength that drives the present day population. Thus the cultural platform of the country is perhaps the biggest launching-pad for new ideas and marketing innovations. It is very important to workout imaginative campaigns and advertising tools that goes well to meet the cultural preferences of the consumers. Precisely, it is a challenge to be culturally sustainable besides being trendy, relevant and high in value. -la Gopa

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25 2

Health & Happiness

Patients with rising blood pressure should adhere to well-defined healthy changes in their lifestyle before putting on any medicine. Many times these changes are all that is needed to bring pressure down to a normal level. igh blood pressure is also known as hypertension. Blood pressure popularly known as ‘silent killer’ isn’t seen as the culprit until a serious medical problem appears. It is in fact, a dangerous problem because hypertension can permanently damage the eyes, lungs, heart, or kidneys. Malignant (i.e., highly elevated) blood pressure is the most challenging health issue today.

What is BP? Blood pressure is the amount of force exerted against the walls of the arteries as blood flows through them–if a person has high blood pressure it means that the walls of the arteries are receiving too much pressure repeatedly–the pressure needs to be chronically elevated for a diagnosis of hypertension to be confirmed. In medicine chronic means for a sustained period; persistent. The heart is a muscle that pumps blood around the body constantly–during every second of our lives. Blood that has low oxygen levels is pumped towards the lungs, where oxygen supplies are replenished. The oxygen rich blood is then pumped by the heart around the body to supply our muscles and cells. The pumping of blood creates pressure–blood pressure. The Problem When blood pressure is checked for a patient two types of pressure are gauged : 26

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Systolic pressure–the blood pressure when the heart contracts, specifically the moment of maximum force during the contraction. This happens when the left ventricle of the heart contracts. Diastolic pressure–the blood pressure between heartbeats, when the heart is resting and dilating (opening up, expanding). When a person's blood pressure is taken the doctor needs to measure both the systolic and diastolic pressures. The figures usually appear with a larger number first (systolic pressure), followed by a smaller number (diastolic pressure). The figure will be followed by the abbreviation "mmHg", which means millimeters of mercury. When a patient is informed that the blood pressure is 120 over 80 (120/80 mmHg), it means a systolic pressure of 120mmHg and a diastolic pressure of 80mmHg. Stages of BP Anyone whose blood pressure is 140/90mmhg or more for a sustained period is said to have high blood pressure, or hypertension. Blood pressure is usually divided into five categories: ¡ Hypotension

(low blood pressure) Systolic mmHg 90 or less, or Diastolic mmHg 60 or less

ÂĄ Normal

Systolic mmHg 90-119, and Diastolic mmHg 60-79 ÂĄ Prehypertension

Systolic mmHg 120-139, and Diastolic mmHg 80-89 ÂĄ Stage

1 Hypertension

Systolic mmHg 140-159, and Diastolic mmHg 90-99 ÂĄ Stage

2 Hypertension

Systolic mmHg over 160, and Diastolic mmHg over 100 Precisely, blood pressure is the force of circulating blood against the inner walls of blood vessels. The amount of pressure is determined by how much blood the heart pumps, how forcefully the heart is pumping, and the amount of resistance to blood flow in the arteries. Arteries are flexible, capable of narrowing or expanding. This isnâ&#x20AC;&#x2122;t the same, however, as the flexibility of a plastic hose, which responds mechanically to pressure inside it. Arteries are living tissue, and they can expand or contract due to stress or changing emotional states. Blood pressure isnâ&#x20AC;&#x2122;t steady, either; it normally fluctuates throughout the day. Hypertension is diagnosed as persistently high pressure in the arteries. Risk Factors Risk factors generally attributed to BP can be managed.These include: Ĺ? Ĺ? Ĺ? Ĺ? Ĺ? Ĺ? Ĺ? Ĺ? Ĺ? Ĺ? Ĺ?

1DGUKV[ C RTKOCT[ TKUM HCEVQT 5OQMKPI QT WUKPI VQDCEEQ KP CP[ HQTO &TKPMKPI VQQ OWEJ CNEQJQN .CEM QH GZGTEKUG *KIJ NGXGNU QH HCV CPF EJQNGUVGTQN KP your blood 6QQ OWEJ UCNV UQFKWO KP [QWT FKGV 6QQ NKVVNG RQVCUUKWO KP [QWT FKGV 6QQ NKVVNG XKVCOKP & KP [QWT FKGV 1TCN EQPVTCEGRVKXGU 5VTGUU %GTVCKP EJTQPKE EQPFKVKQPU NKMG FKCDGVGU and sleep apnea

arise or pressures elevate. A doctor may give an early warning, but realistically, the responsibility lies with the patient. The earlier the patient adopts a positive lifestyle, the greater the benefits for the years to come. Exercise Regular exercise and well prescribed Yoga lowers hypertension as much as some medications. Exercising regularly, for a minimum of 30 minutes a day, 5 days a week, lowers pressure by an average of 5-10 mm Hg. The crux of the matter is being active. If a patient becomes active he is sure to get relaxation besides feeling a fair degree of happiness and resultant drop in blood pressure. Being active: Ĺ? 5VTGPIVJGPU VJG JGCTV UQ KV RWORU OQTG efficiently and with less force Ĺ? +PETGCUGU RTQFWEVKQP QH PKVTKE QZKFG a naturally occurring substance that induces arteries to dilate Ĺ? 4GFWEGU KPHNCOOCVKQP C OCLQT ECWUG QH artery-hardening plaque Ĺ? +ORTQXGU EJQNGUVGTQN CPF VTKIN[EGTKFG levels Ĺ? 4GFWEGU UVTGUU Food Habits Well, what BP patient should eat on a regular basis? The following foods are rich in inflammation-fighting antioxidants, fiber, and essential nutrients: Ĺ? 9JQNG ITCKPU UWEJ CU QCVOGCN YJQNG wheat, and quinoa Ĺ? %QNQTHWN XGIGVCDNGU NKMG FCTM NGCH[ greens, tomatoes, sweet potatoes, and carrots Ĺ? &CTM UMKPPGF HTWKVU KPENWFKPI DNCEM grapes, cherries, and plums Ĺ? .GCP RTQVGKP UWEJ CU HKUJ EJKEMGP CPF vegetable protein

Ĺ? 0WVU UGGFU CPF NGIWOGU Ĺ? %CPQNC QKN CPF GZVTC XKTIKP QNKXG QKN Avoid ÂĄ Salt.

Sodium (salt) causes some people to hold extra water, putting additional stress on their heart and blood vessels and causing blood pressure to rise. Watch out for processed food and restaurant food, especially fast food, which tend to be high in salt.

ÂĄ Alcohol. ÂĄ Caffeine.

Caffeine can cause brief but dramatic increases in blood pressure.

ÂĄ Sugar.

Thereâ&#x20AC;&#x2122;s growing evidence that eating a diet high in sweets may lead to hypertension.

ÂĄ Smoking.

Quitting smoking reduces inflammation and greatly decreases the chances of having a heart attack and stroke.

Reduce stress: Unmanaged stress increases blood pressure because stress elevates levels of corticosteroids, the â&#x20AC;&#x153;stress hormones.â&#x20AC;? Corticosteroids increase blood pressure, among other physiological effects. Lose weight: Being overweight or obese makes hypertension worse. As your body weight increases, your blood pressure goes up, too. Develop taste for diversification: Try listening to pleasant music. Get enough sleep: Sleep helps to regulate stress hormones and maintains the health of the nervous system. Itâ&#x20AC;&#x2122;s possible that stress hormones that are unregulated due to lack of sleep could contribute to hypertension. Treatment with medication: If lifestyle measures donâ&#x20AC;&#x2122;t lower blood pressure sufficiently, timely one or more medications may be necessary.

Managing BP When BP is a reality the question is managing the problem effectively and on a long-term basis. It is an important aspect as lifestyle change. Patients with rising blood pressure should adhere to well-defined healthy changes in their lifestyle before putting on any medicine. Many times these changes are all that is needed to bring pressure down to a normal level. But the key is to make them work before symptoms

The crux of the matter is being active. If a patient becomes active he is sure to get relaxation besides feeling a fair degree of happiness and resultant drop in blood pressure BOI

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We are delighted to share the merit certificate to "BOI Guiding Star" awarded by the prestigious Shailaja Nair Foundation with our Readers.