India’s Federal Bank to offer blockchain based remittance solutions to NRIs.
With more than 15% market share in remittances, bank expects to grow through digitisation.
For illustrative purposes only Image Credit: Agency.
Dubai: Federal Bank, an Indian private sector bank, on Thursday launched two technology-based remittance variants in the UAE enabled through partner exchange houses and banks for making remittances to India.
With more than 15 per cent market share in remittance to India, the bank expects to increase its share of business through more technology-driven solutions for its customers in the GCC region.
“Federal Bank is an important part of the remittance eco-system to India, so, it is only natural for us to offer the latest technology to our customers and remittance partners such as exchange houses and banks,” said Shyam Srinivasan, MD & CEO, Federal Bank.
The bank has recently upgraded its blockchain platform for remittances. The new easy-to-plug-in platform enables exchange houses and banks in the Middle East to connect their existing solutions to make seamless, real-time transactions. Lulu Exchange, a UAE based exchange has gone live with this upgraded cross-border remittance platform.
The bank has also launched a platform for NRIs to send money through exchange houses and banks using an easy-to-remember Virtual Payment Address (VPA) of the beneficiary. The platform which rides on the capabilities of UPI 2.0 — the upgrade of the Unified Payment Interface by National Payment Corporation of India — allows customers to make remittances to India using a virtual payment address.
As part of upgrading remittance solutions the bank has also entered into a partnership with Ripple Inc, a blockchain supported global remittance company, for cross border remittance through its network. “For long Federal Bank has endeavoured to bring our non-resident clientele closer to their homes. Each of our digital offerings has been designed with this objective in mind,” said Srinivasan.
Bank set for double-digit loans and deposits growth.
Dubai: In the current financial year, up to the close of the third quarter ended December 31, 2018, Federal Bank reported loans and deposit growth in excess of 20 per cent each.
“Both credit and deposit growth for the bank over last many quarters has been well into the 20s. Both low cost and the overall deposit growth has been quite good. We have close to 1 per cent overall deposit market share and we are growing close to 2 per cent. On the incremental deposit addition in the market, we are getting close to 2 per cent of the share,” said Shyam Srinivasan, MD & CEO, Federal Bank.
The bank has been keeping up consistent credit growth over the past 10 quarters a growth of about 25 per cent and is expecting to keep up the momentum in both corporate and retail portfolios.
The bank currently has one of the best asset quality matrices among the Indian banks and has a non-performing loans (NPL) ratio of about 3 per cent. “For many quarters now, we have maintained consistent asset quality. We expect to maintain cost of credit at around 65 basis points, in line with our earlier guidance,” said Srinivasan.
For further expansion, the bank is stepping up its digital focus. “The theme is branch light and distribution heavy. We have put in more relationship managers so we go out more than the clients come to us,” he said.