The Hindu Business Line : Cos keen to tap integrated risk management space

Hyderabad, Oct. 28 Banking, financial services and insurance sectors are gradually moving to an integrated risk management approach. This is to meet their internal business requirements and market challenges, and also to address mandatory compliance-related issues, including Basel II in the case of banks and solvency for insurance sectors.

For large financial services players, who offer both banking and insurance services, it is now an integrated technology transformation challenge. The Head of Product Marketing, Reveleus, Mr Arun Pingaley, told Business Line that systems built by financial institutions themselves are prone to judgment errors, as risk management arms have independent roles.

Risk mitigation

Therefore, the best solutions lately are those supplied by external vendors, which provide total transformation addressing risk and capital issues. Mr Pingaley, who represents, Reveleus, an i-flex business addressing BFSI segment, said that risk mitigation is itself passing through a transition, wherein from external approach, it is becoming an integral part of the organisation. That is why even regulators, who have evolved Basel II, are moving from external to internal assessments, which experts believe are more reliable.

Increasingly, banks in India are taking up streamlining of their technology infrastructure to align with risk mitigation strategies. Banks are looking at this tactically, and have the advantage of by-passing intermediate stages and leap-frogging to new technology frameworks like Reveleus.

The other important aspect is that many banking and financial services players in India such as the SBI, ICICI Bank and HDFC are becoming all-in-one service providers — banking and insurance. This also presents them with the opportunity to address risk in an integrated form.

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