Open Banking Architecture

Mayank Mishra Principal Banking Architect Oracle Asia Pacific

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Emerging Banking Trends New Areas of Opportunities

Retail
Fee based Income (Mutual funds, Banc assurance) Mobile Banking Processing efficiency in Account Origination Financial Needs Analysis (life cycle driven) Payments Hub

The Unbanked
- Microfinance Initiatives - Distribution through Partnerships (postal, retailers) - Pre-paid cards to reduce the Risk - New segments Farmers, Students, tourists

Corporate & SME

- Maximize cross sell across verticals e.g. Trade - Treasury, Cash - MM, Custody - Treasury - Vendor Financing Converging Cash & Trade - Structuring custom Loans Risk adjusted pricing - Liquidity management, Sweeping

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IT Reality - Without an Architecture ! Integration problems -> in-flexibility, high cost, high risk
Customer Information System General Ledger Data Warehouse

Current &Applications & Data Fragmented Consumer Corporate Savings Banking Banking Accounts Fragmented Business Processes, Visibility Fragmented Security and Management Complex, unmanageable environment Trade Treasury Private Insurance finance Unscalable, Costly environment Banking

Branch network

Call centre

ATM Network

Internet Banking

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Framework for Customer Service Delivery

Banking Eco System Leveraging all

Partner Banks & Agencies

Customers

Collaboration Sales Unit Service Unit

Banks Product Business Unit

Regulators

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Agenda Banking Architecture

Business Demands & Trends Architecture Approach Ideal Banking Architecture

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Purpose of an architecture
To allow IT strategy to align with the business strategy
Regulators demanding greater transparency and accuracy Channel optimisation and profitability analysis IAS, Capital Adequacy requirements being adopted in varying degrees Administration and training costs; closing the strategyexecution gap

Corporate Governance

Customer Management

Risk Management

Human Capital

Control and Customer focus while reducing the Cost and Complexity
Optimize
Maintenance costs; time to market, new products; multi-channel integration

Core Systems Optimisation

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Key objectives from IT Investments!! Getting value from IT

Better Cost allocation
- Minimal Capital expenditure - To tie the costs to business value delivered - Leverage technology to minimize capital investment - Lower operations risk by reducing manual exception handling - Reduce cost of internal & external change

Technology Independence & Re - Use

- Capability to enrich the satellite systems in the bank - Leverage on SOA to have shared services Infrastructure - Real time environment, reduce batch windows - Reduce Vendor Risk, go Open systems - Collaborate, promote Open finance initiatives

Competitive Advantage by Business Agility

- Products & services innovation at affordable price - Easy Integration of partners into the banks portfolio - Reduce cost of change by configuring products & Services, no expensive IT delivery cycles - Support Business in BPR & automation initiatives - To enhance the customer service

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Architecture Selection Criteria

Future Proof your Investments

Architectural longevity (the changes in technology and fortune that the platform will undergo during the next three to five years) Availability of skills (from lower cost of ownership as well as lower inertia point of view) Level of integration required (the amount of system integration work the customer is required to do) Manageability: Planning downtime, partitioning, capacity on demand, workload management Market momentum: Independent software vendor (ISV) and channel enthusiasm, market share, demand creation

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Evolution of computing Infrastructure

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Agenda Banking Architecture

Business Demands & Trends Architecture Approach Ideal Banking Architecture

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Moving Away from a product-focused design To a Reusable Design

Legacy Business Model
Deposits Loans Cash Treasury

New Services based Business Model

Deposits Loans Cash Treasury

Product development Reporting

Product development Reporting

Product development Reporting

Product development Reporting

Product Development Reporting

Interest/Fees Interest/Fees Interest/Fees Interest/Fees

Interest/Fees

Accounts

Accounts

Accounts

Accounts

Accounts

Facilities

Facilities

Facilities

Facilities

Facilities

Payments

Payments

Payments

Payments

Payments

limited flexibility and re-use with ever-increasing maintenance costs

provides business, process and data components that are re-useable across product lines

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Processes Automation, Efficiency & Enrichment Gaining Business Agility

Many advantages
Automate mundane processes
Reconciliations Exception management
BPEL is the future of the integration space in my viewWhy? Because the value is so much higher when you provide not only a way to integrate applications, but also a way to create services from them and put them into business processes - John Rymer, Vice President, Forrester Research, Inc.

End to End Process Efficiency

Loan origination Credit Card approvals collections

Open Finance
Collaborate to offer attractive products

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Customer Centric
Understanding the customer better
Targeted Marketing for better results
Siebel Chordiant

Readiness for compliance (KYC) Understanding life-cycle requirements

E.piphany BroadVision

Understanding Customer Customer relationship

SAP Legacy

PeopleSoft

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End-to-End Insight

Siebel Analytics Integrated To Oracle FSI Analytics

(OFSA)

A banker asks . . .
What products are most profitable to sell to whom? How to better hit our targets? How to improve wallet share?

Where are organizational bottlenecks?

What is our Risk Adjusted Return?

Pervasive Insight from the Back office to the Front

Profitability Analytics
Multi Dimensional Profitability Activity Based Costing Transfer Pricing

Risk Management
Risk Assessment/ Quantification

Operational & Financial Analytics

Performance Scorecards Operational Cost Analysis Bank Performance Analytics

CRM Analytics
Interaction History Customer Behavior Segment Migration Propensity to buy

Credit Operational Market

Regulatory Compliance

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Cost Management
Improve IT asset Utilization

Centralize the Operations

Simplify Support and Reduce Cost Consolidate Hardware to a GRID on demand Bring Branch processing to the center

Reduce hardware investment and software licenses

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Well defined Architecture

Call Center ATM Internet IVR Branch Corporate Channel Partner Channel

Access Channels Collaborative Access Management Business Process Orchestration & Management Integration Management

Lending, Deposits & Accts

Trade Finan ce

Cash Mgmt

Treas ury

Cards &
Switch

Invst Mgmt

Customer Information
Management

Partner

Customer
Relationship Management

Management

( Suppliers, counterparti es)

Transaction Functions

Support Functions

Enterprise GL Management Information Risk Management Data Management

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Fusion Architecture - All encompassing

Technology Superiority

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Thank You

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