Banks have not taken the full advantage of technology for bringing down the cost of small transactions, improving customer services and an effective flow of information within banks and with the regulator, the Reserve Bank of India (RBI) has said.
“One of the shortcomings that has been observed is a disconnect between the information and technology. Although banks have deployed technology for transaction processing, the same has not been explored extensively for analytical processing,” the regulator said in its IT Vision document for 2011-17.
RBI, which released the document yesterday, emphasized on the introduction of technology that balanced three Cs, namely, Cost, Control and Customer Services.
The central bank said information technology needed to be revisited, with a focus on implementing data warehousing and business intelligence, adoption of technology-based strategies for financial inclusion, improving customer relationship management (CRM), risk management, fraud detection & prevention and business continuity plans.
“IT-based solutions entail operational risks, for which banks have to put in place appropriate control mechanisms and mitigation techniques. With financial stability an important target, the Reserve Bank assigns importance to mitigate IT-related risks in the banking sector,” it said.
RBI will start implementing the recommendations of the Vision document shortly. The statement also chalked out focus areas for the regulator. These includes transforming it into an information-intensive knowledge organization.
Harnessing human resource potential, migration to enterprise architecture for IT systems and adopting appropriate business process re-engineering are some of the areas outlined by the report.