What does it take to change the course in business? Can big banks survive the onslaught of nimble-footed financial technology companies? How do you change the deep-rooted culture of an organisation to drive digital transformation? These are pertinent questions, especially at a time when technology is evolving rapidly, brushing aside stiff-necked companies. This is not a story of a company that fell by the wayside, but of a bank that disrupted itself to avoid being disrupted. It is the story of the most valued Indian bank—HDFC Bank—and how it came out on top in the digital sweepstakes.
State Bank of India Chairman Rajnish Kumar and HDFC Bank Managing Director Aditya Puri, on Wednesday, launched the book ‘HDFC Bank 2.0 – From Dawn to Digital’, written by senior journalist Tamal Bandyopadhyay. The book, a sequel to ‘A Bank for the Buck’, published in 2012, chronicles the digital transformation of the lender under the leadership of Puri. Bandyopadhyay charts the intertwined journey of the bank and its current chief Puri with elan. As Nandan Nilekani in his foreword puts it, he is an excellent storyteller.
It all started in September 2014, when Puri took a trip to California, to get a first-hand experience of how fintech companies were changing the face of banking. He came back with a question for his colleagues: “Why don’t we disrupt ourselves instead of waiting to be disrupted by fintech companies?” The introspection that followed defines the digital journey of the bank. Consider this. As of March 2018, 85 per cent of overall transactions at the bank was conducted through digital channels. The figure was around 60 per cent at the start of the financial year 2015-16.
Bandyopadhyay has chosen the perfect time to come out with his second book on the lender. It has turned 25 this year and is in the pink of health when most others around it are struggling. The Mumbai-headquartered bank has remained blemish-free at a time when many of its peers have been snared by corporate governance lapses. HDFC Bank has been clocking over 20 per cent profit growth for at least the last 10 years and its gross NPA ratio remains in low-single digits when the industry average is around 10 per cent.
Much of the success can be credited to Puri’s leadership and the processes he put in place at the bank. The constant endeavour to reinvent, and stay ahead of the curve has been the hallmark of his tenure which could end next year when he turns 70. His thought process can be gauged by his vision to turn HDFC Bank into a financial marketplace from a brick-and-mortar bank. The lender is transforming itself from a lifecycle bank to a lifestyle bank.
Elaborating, Bandyopadhyay writes in the preface, “It wants to be India’s Alibaba or Netflix when it comes to banking.” At 69, Puri is the highest serving head of a bank anywhere in the world. It is hard to imagine HDFC Bank without Puri, but he is set to retire next year. Will the bank falter without him? Will its growth lose steam? To know what Bandyopadhyay thinks, get your copy at the earliest.
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