The country’s second largest private sector lender ICICI Bank is betting big on open architecture and interoperable model on its digital initiatives to gain customers across segments, with spends on technological infrastructure not being a constraint for the bank.
The bank’s non-employee expenses increased 15.6 per cent year-on-year (YoY) to Rs 4,620 crore in Q4FY22, primarily due to retail business and technology-related expenses. For the whole year, non-employee expenses increased 26.65 per cent YoY to Rs 17,060 crore. Technology expenses were about 8.5 per cent of the operating expenses in FY22, or roughly about Rs 2,272 crore.
“If you have 5-10 per cent market share, the rest is with others. So, it is quite obvious that if you open up (services), there will be a wider customer base. They may not shift but they can experience our products,” said Anup Bagchi, Executive Director, ICICI Bank.
“As far as technology spend is concerned, it is not a constraint at all. What we have to be vigilant about always are cyber risks. We spend a lot on it but as a percentage of our pre-provisioning operating profit, it is insignificant. Hence, there is absolutely no cap on the technology spends and there is a clear direction from the board,” Bagchi said.
The latest offering from the bank is a comprehensive digital ecosystem for all micro, small and medium enterprises (MSMEs) in the country, including customers of other banks. Through the app, the bank will provide enhanced banking services for existing customers, bouquet of banking services to MSMEs, who are customers of other banks, and a range of value-added services for all.