Increased acceptance of credit bureaus with the rising importance of credit score as a key parameter to assess credit worthiness coupled with rapid technology transformation has given birth to a more evolved approach. Today, credit bureaus are evolving beyond just offering credit score. They are building up a strong portfolio of value added services such as benchmarking analysis, predictive analytics, credit monitoring, etc. to cater to growing customer demands. Pinkesh P Ambavat, CTO & CISO, CRIF High Mark, India’s first full service credit information bureau, in conversation with Shipra Malhotra, Executive Editor, dynamicCIO.com talks about how digital can enable credit bureaus keep pace with the changing industry dynamics and heightened customer expectations. He also highlights the company’s journey towards achieving speed and agility through cloud.
Shipra Malhotra: How do you see the growing competition credit bureaus are facing from fintech startups?
Pinkesh Ambavat: Today we are seeing a younger demography that is highly tech-savvy with a natural affinity towards mobile and digital, changing the expectations from financial services providers. These include instant service, 24×7 availability, more choices, right-fit solutions, seamless experience and more value for money among others. Fintech start-ups, not worried by any legacy systems or too many regulatory compulsions, are building upon established financial markets and leading with customer friendly solutions to address these newer expectations.
Many fintechs are emerging with a business model to collect and use datasets that are different from what traditional credit bureaus have access to. Some of these datasets offer good value that can help banks, NBFCs and other financial institutions gain more insights about the end consumer. We see these players as partners in the ecosystem. In fact, such datasets can complement credit bureau data and together we can service our end customers even better.
SM: Data is at the core of digital transformation. What challenges do CIOs/CTOs face in dealing with this data?
PA: CIO challenges are complex and abundant. Businesses need to derive timely insights from a growing diversity of content, transactions and feeds. There is a need to re-think how data is captured, preserved, accessed and transformed. And, CIOs not only need to think about technology but also about transforming the team culture. Data security, data protection, multi-cloud security, outsourcing risks and quality innovation are some of the areas where we often have to do a tight ropewalk balancing the priorities. CIOs should lead the way for data strategies and architectures instead of just infrastructure to enable real-time intelligence for business users and clients.
SM: Going forward which digital technologies do you see becoming the game changers for credit bureaus?
PA: Blockchain can be more prominently used in our industry in the next few months/years, promising a more immutable decentralized network. Artificial Intelligence and machine learning are revamping the way credit scoring models are built. On the technology side, we are increasingly adopting a cloud based infrastructure for more scalability and availability.
SM: What was the key business requirement that propelled you to consider cloud?
PA: Agility and speed are of utmost criticality as our business is growing at a rapid pace and the environment that we operate in is also very dynamic. We witness surges in volumes during specific periods, such as festivals and during month-end, quarter-end and year-end. Also, whenever we add a new large client to our user list, the volumes can suddenly go up. If one of our clients is running a special customer campaign, we may see spikes in volumes from them on those particular days. In fact, the volumes can touch a thousand transactions per second on such days.
At the same time, our clients also expect best transaction response times (in micro or mill seconds) even during peak festival seasons to ensure they are able to serve their end-consumers with instant approvals when the end-consumers are likely to use the loan or credit products most. To meet the business demands, we need to embrace an infrastructure which is scalable in real-time and also offers high uptime given the nature of our business.
The technology function needs to plan, design and make available to the business a robust IT infrastructure which can handle any such spikes in volumes without impacting per-transaction SLAs. While we focus on supporting client needs, we also do not want to go over-budget with respect to our IT infrastructure and minimize it being idle during non-peak hours. As CTO of the organization, I also need to make sure the IT costs are managed well too.
SM: How are you leveraging cloud in meeting the customer service demands?
PA: One of the major challenges we faced prior to moving to cloud was lack of flexibility to scale up infrastructure on the fly based on the transaction volumes hitting our systems. Post the move to Oracle Exadata Cloud at Customer we have the flexibility to increase our transaction processing infrastructure at will during peak time without having to provision for it in advance. It gives me and our business leaders the comfort and peace of mind about our processing capabilities.
With Oracle Exadata Cloud at Customer we have been able to process 2x more real-time transactions during the festive seasons with a 2x better response time. The Oracle Cloud team directly manages the infrastructure operations and guarantees an uptime of 99.95%.
SM: What are the critical success factors for an organization’s digital agenda to be truly transformative?
PA: Transformations are hard and digital ones even harder. But, given digital is a business imperative, transformation has to be driven from the top and with full strategic buy-in with frequent re-inforcing of communication and milestone achievements. It shall entail questioning the status quo. I believe, the key is to drive digitization in a holistic manner for sustainable results. Another important focus area should be up-skilling people within the organization and making them comfortable with the new normal.