City Union Bank To Increase On Retail, Trading and Agri Sector
Swaminathan Balasubramanian
Kumbakonam: City Union Bank, one of the leading private banks in the country is likely to increase their existing focus on the small and medium business through their focus on the industry verticals like retail, trading and agriculture segments.
Dr Narayanan Kamakodi, Managing Director and CEO, City Union Bank, in an exclusive chat with SME Venture, said, “We are a traditional bankers who were not focusing much on the B2B business. We only had focus on consumer segment. Recently, our focus was expanded in the SME segment which has given us considerable outreach. Out of our total loan book, 65-70% comes from retail, trading and agriculture [and related] sectors. We will continue to increase the focus in the same.” Asked if his organization is planning to expand the verticals, he said, “We want to first focus on our strong areas. That way we will strengthen our strong areas in this segment first and then might be thinking of other areas.”
Kamakodi further added that the introduction of the GST and demonetization has brought many unorganized SMEs and MSMEs into system and everyone had come up with accounts and this had brought even a smaller establishment deposit and receipt into the bank. “I do agree that till date, financing is the key issue for many of the small entities. That is where I think many alternative financial models started venturing out”, he said. He divides the lending pattern by any traditional or non-traditional bank on the scale of the amount given viz. below 2 lakhs come under one category, 2 lakh to 50 lakhs under one category and more than 100 cr business.
Asked why startups are out of purview of the traditional banks, he said that many banks do not understand the tech business and cannot predict the risk factors. That is the reasons most of the conventional banks are not interested in start up companies. However, you have many venture capitalists and other new age angel investors are in that space.
CUB Lakshmi:
On the tech front, City Union Bank (CUB), has deployed robots to answer customer queries at its branches, is reprogramming a machine for collecting cash from customers. Titled as Lakshmi, the robots are installed in five of their branches for initial level interactions. We will enhance our staff productivity by having quality engagement with the customers. In an interview for a leading publication Kamakodi has mentioned that the idea of ‘Lakshmi’ was evolved during a conversation with one of a senior technology officer at a US bank. CUB claims it is the first bank to introduce a robot, which is now functional. “Lakshmi has created huge interest among our customers. The robot presently handles general queries in English and should soon be able to speak in local languages. We are in the process of using the robot for other banking activities including handling of cash. We are aiming at a point where the robot can handle entire queries and typically replace the ‘May I help you’ section in our branches. We do not want our staff to do only form filling or other mundane tasks which could be done by a technology”
CUB is one of one of the first banks to go for cash acceptors, express counters, internet banking and mobile banking. Accoirding to Kamakodi, most of his business as well as normal customers started becoming digital and technologies like Adhaar will increase the digital acceptance.
Expansion plans:
On the expansion plans, he said, his organization is having deep penetration in Tamil Nadu, Andhra Pradesh and Telangana. We have close to 20-25 branches in Maharashtra. We are aiming to increase presence in Gujarat in the coming days.