HDFC Bank: It's About Experience

Aditya Puri has transformed HDFC Bank from a mere transaction-based bank to providing a sophisticated experience, making innovation the core of the bank. In 2017, HDFC Bank introduced a humanoid robot at its welcome desk in a prominent branch, greeting customers and displaying a list of services, and guiding them to appropriate counters. This is one of the numerous innovations it has introduced to banking.

In the past few years, in fact, HDFC Bank has been transforming itself through technology and shifting its focus from transactional interaction to experience differentiation. This means that the bank will provide more and more technology-driven innovative products that will work seamlessly across all its channels, that is net banking, mobile banking, digital wallet, or its compare-and-shop portal, Smartbuy.

The idea is to make boring banking transactions experientially fun for customers and extremely easy to use. The bank has introduced an AI-based chatbot EVA (Electronic Virtual Assistant) on all its digital platforms, which helps customers find information in quick time, eliminating the need to talk to a customer-service agent. This bot also works with Google Assistant and Alexa.

Also, the bank introduced a banking bot that makes transactions possible via Facebook messenger, which means customers can book movie tickets, check stock prices, book cabs and hotels, and so on.

On the banking front, it has introduced a 10-second loan for pre-approved HDFC Bank customers, which is available 24x7. If you have invested in mutual funds or shares, the bank has created an innovative product called Digital Loans against Securities and Mutual Funds. With this, customers can pledge their shares and funds online, and obtain an overdraft in a short while.

The bank is also driving holistic growth of communities through its CSR activities in five distinct areas, ie, rural development, promotion of education, skill development, healthcare and hygiene, and financial literacy and inclusion. In rural development, through various NGOs it has covered 2.98 lakh houses impacting 870 villages.

The bank has also been working on various initiatives of the government, with the Ministry of Electronics and Information Technology ranking it as the number one bank for supporting several initiatives executed by the Ministry. HDFC Bank has also created its own start-up fund to work with accelerators to promote entrepreneurship. On the public funds side, it has developed several technological solutions to manage schemes such as the National Health Mission, PMAY and MNREGA, among others.

On the financial front, HDFC Bank consistently ranks number one among large banks, including the BW Best Bank Awards. Over the last five years, profits have increased consistently, from Rs 8,478 crore in FY14 to Rs 17,487 crore in FY18.

Besides, the bank has net NPAs of just 0.4 percent, one of the lowest in the banking sector. For a bank that boasts a balance sheet of Rs 10.63 lakh crore, that is a remarkable achievement. In a recent interview, managing director Aditya Puri stated: “I see the bank becoming a financial experience for customers. I should be able to give him an experience that uses technology in a frictionless way, that too, across a much wider product range.”

On the other hand, the bank has a consistently high return on capital, of 18.2 percent in FY18, and has been consistently reaching a net interest margin of 4.3 per cent over the past two financial years. For a bank that has just 4,787 branches, what is noteworthy is that it caters to 4.36 crore customers with 85 percent of transactions through digital channels. Truly, a bank at the forefront of digital change.