Blockchain-based solutions, key to Infosys’ Finacle growth plans

With its recent acquisition of UK-based design firm Brilliant Basics, Infosys has managed to bag banking deals for its Finacle product, which could give a much-needed fillip to its platforms business.

Sanat Rao, Chief Business Officer and Global Head of Finacle, told BusinessLine over telephone that the software major was able to get orders from three banks recently, including two in West Asia and one in the US.

“Brilliant Basics, with its expertise in modern techniques such as Design Thinking, allowed us to add an extra layer for our Finacle banking solution,” he said.

Infosys had acquired Brilliant Basics, a London-based product design and customer experience (CX) company, for an undisclosed sum in August. Finacle is a banking solution from EdgeVerve Systems, which is a wholly-owned subsidiary of Infosys and forms a part of the platforms business, which, according to reports, crossed $500 million last year.

Industry watchers believe that these efforts by India’s second-largest software exporter would help accelerate the growth of its flagship banking solution, Finacle, even as the global banking sector is undergoing techtonic technology shifts, driven by a slew of new-age companies such as Alibaba, Paytm and others. These shifts have resulted in customers starting to move away from traditional banking services such as plastic cards and currency to modern payment solutions such as cryptocurrency and increasing use of mobile phone-based payments.

While Infosys acknowledges that these technology shifts are threatening banks, it however, believes that these issues will not impact Finacle. “Regardless of the changes the threat to the traditional business models of banks, there will continue to be a need for banking services and we view these changes as huge opportunities going ahead,” said Rao.

Infosys Nia, the company’s AI platform and among its newest offerings, is something Finacle has been pushing to the banking industry vigorously. Comprised of its analytics, robotic processing automation and machine learning offerings, Rao is of the opinion that Nia could provide a vital boost to banks looking to compete in the changed industry ecosystem. “This will not just provide the technology backbone but will also analyse the information for banks, provide insights to financial institutions – which can reduce frauds, risk and customer insights – and streamline operations using automation, according to Sanchit Vir Gogia, founder, Greyhound Research.

New age companies offering banking services, like Paytm which became a Finacle customer last year, are also looking for solutions to bridge the gaps in their technology backbone. “They have acquired customers but do not have a strong IT backend to which can manage all the required banking business functions,” said Rao.

Blockchain is another area where Infosys has invested much to drive growth. Recently, Infosys announced the launch of Finacle Trade Connect, a blockchain-based trade finance solution for banks. Traditional trade finance processes involve complex documentary processes, relatively higher transaction costs such as high cost of messaging, higher times to settlement and lower authenticity with physical document management.

The new solution will help digitise the trade finance business process, including validation of ownership, certifying documents and making payments while working on a distributed, trusted and shared network. This is expected to be a game changer for the trade finance banking, given the typical high costs, delays and risks with existing processes. Rao confirmed that 11 banks have already signed on for a pilot on the new solution.

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