Brick-and-mortar and mobile banking to grow together: SBI Chairperson Arundhati Bhattacharya

Globally, mobile wallet companies are threatening banks' brick-and-mortar model. India is no exception. In fact, non-bank mobile wallet players have already forced banks to launch their own digital wallets. The country's largest bank, the State Bank of India (SBI), has also responded by launching its own e-wallet named 'Buddy'. In an exclusive interview with Business Today's Anand Adhikari, SBI Chairperson Arundhati Bhattacharya talked about the emerging digital banking trends in India.

On SBI's mobile banking strategy

The mobile space is very important. There is absolutely no doubt about it. What we are saying is that we are not yet seeing all the branches disappearing. But the branches are becoming more digital branches where people want to come and do things on their own. So while we are converting the brick-and-mortar structure, we will also ensure that all the banking services will be on the mobile space as well.

We agree with the market, which says that at the end of the day everything will be on the mobile. We are also in that journey. The journey for us has also started. It is not as if we are ignoring it and saying that we will stay with brick-and-mortar banking. India is a very strange country in the sense that we have a large population of older people, while we have an even larger population of younger people. Just because the younger people are more doesn't mean that older people are less. Therefore, there are a lot of older people who still find comfort in coming to a branch. And they would prefer to be serviced at the branches. How do I make their life easy? How do I ensure that their requirements are met? While I will do the mobile piece, I need to ensure that the other piece is also done. That is where we come from.

On Indian private banks considering product specific applications

We already have certain product specific schemes. On the mobile space, we don't have product specific applications, but we are looking at ways people are making loans these days. This is something that we are looking at and it is not something we have done as yet. As you know, we have MoUs with Amazon and Snapdeal and maybe with some others like MakeMyTrip. There again we are trying to see how we can collaborate so as to ensure that people who sell can access finance at reasonable cost, and people who buy can also get finance at reasonable cost.

On SBI's engagement with tech entrepreneurs

We continuously engage with start-up entrepreneurs. We have recently met lot of young entrepreneurs in Bangalore. There were eight of them who made a presentation on what they have for us. We actually went with the entire top management team. The idea was to see what they have for us. We are engaging with few of them for future products.

On future transformation or disruption in the banking model

It will happen, but the fact of the matter is that banks will not get wiped out. Now you might see technology companies becoming banks with payments bank licences. It's possible. We have to see how we can change ourselves in order to remain relevant. That is very much a part of the entire ecosystem that we are in. Today, you have to be many things at the same time. I must say that where money is concerned, a large segment of people in India are still more comfortable with brick and mortar. That segment may slowly get phased out, but given the number of people we have, I don't think it will happen in the immediate near future. Maybe over a period of time - in the next 20-25 years - but not in the immediate future.

On the fight for converting cash into digital wallets like movie tickets, car rent

We are trying to take care of that through wallets. We have launched buddy, which is a digital wallet. We are very much there. Obviously, it is an opportunity and we are looking at that opportunity. There is no doubt about it.

On Chinese e-commerce companies hawking financial services products, while their banks also sell shampoos to wine

That is something that we have actually not considered whether we are also going to be an e-commerce company. But who knows? The future will reveal itself. I do not know. At this point of time we are not thinking about selling stuff. We have a brick-and-mortar presence to some extent that can be leveraged for many more things. These can be used for pick-up points. That is something we could think about. We have to understand that banking regulations don't allow these things. We have to see what is allowed and what is not.