‘No plan to hive off YONO app’

Addressing the much-debated issue of State Bank of India monetising its digital application YONO into a separate entity, Chairman Dinesh Kumar Khara said the bank has no such plans as the platform operates as an integral part of the distribution channel.

“YONO is part of our distribution channel. How can you ask me to spin off a distribution channel. I cannot spin off branches, so I cannot spin of YONO. So, it has to be part of us, but we will keep investing it in and ensure that it remains ahead of the curve and better than many others,” said Khara at the SBI’s Banking and Economics Conclave.

“We are embarking upon YONO 2.0 where we have the garage system, and we’re probably as nimble as any other fintech,” he added.

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The state-owned lender has invested heavily in upscaling the bank and enhancing digital capabilities, said Khara, adding that leveraging digitisation and analytics is a big focus area for the bank as it is expected to help the lender better understand customer behaviour and reach more customers.

Even so, cyber risk remains an area of concern for all financial institutions, and all banks need to guard against it, he said, adding that as the biggest and most regulated players banks also hold the responsibility of ensuring that all partners and financial institutions working with them are protected against such risks to ensure the banking system is secure.

Currently, almost 88 per cent of the bank’s transactions are digital, and 98 per cent take place outside of branches, Khara said, adding that even then the bank is not looking to rationalise any of its over 24,000 branches as physical presence remains critical to gain customer trust, and a ‘phygital approach’ will remain the way forward.

The bank is also looking at generative AI (Gen AI) and is expected to invest more in the same over the next five years.

“Gen AI is going to be the next big talk. We have already started working on it. We had started working with analytics in a big way and now we’re moving towards Gen AI. In the next five years you should see it unfolding,” Kahara said adding that this will probably help understand customer behaviour, address their needs and eventually shape the way banks will be run in the days to come.

There will also be increased adoption of distributed ledger technology in many of the repetitive jobs going forward. This will be accompanied by Gen AI getting implemented in the banking system, and the emergence of more data-driven banks, he said.