Business Disruptions in India

By- Chitresh JhawarBurhanuddin Ratlamwala

FLOW OF PRESENTATION

• Meaning Of Business Disruption

• Existing Disrupted Industries

• On Going Business Disruption

• Future Business Disruptions

BUSINESS DISRUPTIONNEW MARKET

NEW SET OF CUSTOMERS EVENTUALLY DISRUPT

VALUE NETWORK

DISRUPTIONS WHICH HAVE ALREADY HAPPENED

Worlds most valuable retailer has no inventory

Worlds largest movie house owns no cinema

Worlds largest messaging company has only 55 employees

World’s largest accommodation provider owns no real estate

World’s largest taxi company owns no taxi

BUSINESS DISRUPTION IN BANKING

MEGA TRENDS TRANSFORMING BANKING INDUSTRY

INDIA GOING DIGITAL EMERGENCE OF NEXTGEN PAYMENT PROVIDERS

FAVOURABLE REGULATORY ENVIORNMENT

INDIA GOING DIGITAL

INDIA BECOMING A DIGITAL COUNTRY

TECHNOLOGY REVOLUTION• Powerful processor• Sustainable memory• High Resolution camera• Barcode scanning• GPS geocoding• NFC technologies• E-commerce• Social networking• Banking apps

Practically most of the things

MASSIVE GROWTH IN DIGITAL TRANSACTION

• DIGITAL TRANSACTION GROWTH BY 50%

• BRANCH BASED TRANSACTION REDUCED BY 7%

EMERGENCE OF FINTECH COMPANIES

EMERGENCE OF NEXTGEN PAYMENT PROVIDERS

BANK LED TELECO LED PREPAID/WALLET

E-COMM/TECHPAYMENT BANKS

LENDING INNOVATIONS

SME LENDING

P2P LENDING

SMALL BANKS

SMALL AND MEDIUM-SIZED ENTERPRISES LENDING

• Short-term loans to purchase inventory, service new orders, or optimize cash cycles

Capital is supplied in the form of bank loans and overdrafts; leasing and hire-purchase arrangements; equity/corporate bond issues.

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SMEs contribute 45 % to our GDP as compared to 15 % by the corporate sector.

Eg. Amadeus Advisors Pvt Ltd, Zen Lefin Pvt Ltd

P2P LENDING• Lending money to individuals or businesses unsecured

personal loan

• Secured loans are sometimes offered through collateral

• Crowd sourcing

• Transaction value of USD 416m* in 2016

• CAGR 2016-2020 of 61.2 %*

• Type- Equity and Reward

• Eg. RangDe.org, Milaap social ventures, Kickstarter, ImpactGuru, Ketto.org * Source- Statista.com

SMALL BANKING

• Niche banks for small finance

• 100 crore capital

• To serve the rural market

• Example: Disha Microfin and Ujjivan financial

FAVOURABLE REGULATORY ENVIORNMENT

FAVOURABLE REGULATORY ENVIORNMENT

• KYC relaxation for small transaction

• Exemption from two factor authentication

• Aadhar making KYC easier

• Unified Payment Interface

• Bharat Bill Payment System

SHAPING THE CONSUMER BEHAVIOUR

PAPERLESS

CONVIENT

SIMPLE

FASTER

NO QUEUE

BOTTOM OF THE PYRAMID

USER FRIENDLY

CASHLESS

SMOOTH PROCESS

IMPACT ON THE ECONOMY

• New Opportunities• NEW Market And New

Players• Job creation• Example: PayTM

• Loss of market share• Public Debt• Example: Air India

• Reduction in plastic money

• Infrastructural shift• Airtel can go places

where SBI cannot

• Digitization of existing process

• Paradigm shift in employment

• Reduction in Black money

PROACTIVE APPROACH TO DEAL WITH DISRUPTION

COPING WITH DISRUPTION

GOVERNMENT REGULATIONS• Payment Banking• Crowd Funding• Small Banks

Limitations on the services to safeguard interest of existing banks

STRATEGIC PARTNERSHIP• PayTM with other banks• Share Technology by a start up and bank

EXISTING BANKS• HDFC Payzapp• Going Digital

BIG PLAYERS• Acquisition of small players• Stakes in start ups• Example : Nasper- Citrus Pay

FUTURE DISRUPTIONS

CLOUD COMPUTING

• Cost saving and usage based billing

• Higher level of data protection, fault

tolerance and disaster recovery

• Allows new product development to move

forward without capital investment

• Reduction in energy consumption and

carbon footprint

ADVANCED ROBOTICS• Automate current tasks and same

interaction as human

• Virtual workers

• Higher quality with improved

compliance/auditability

• Productivity boost will save up to 40% of the

time

• Processing cost will come down up to 80%

• Fast implementation of new processes

BIOMETRICS/IRIS AUTHENTICATION

• Aadhaar – Game changer

• NTT Docomo has launched IRIS

recognizing smartphones

• The amount to install biometric

recognition in smartphone to come

down

FACIAL RECOGNITION & VOICE BASED PAYMENT

• 10% search on Google was made

via voice in 2015

• No PIN or password required

• Allows aged and illiterate to access

and use easily

• Example:

- Alibaba- Facial recognition

- ING Netherlands- Voice

Recognition

CONTACTLESS PAYMENT

• Use of NFC or RIFD for transactions by

various cards or other devices

• No PIN or signature required resulting in

faster transactions

• MasterCard Canada observed 25% higher

spending by users through contactless cards

• Use of QR code technology by China

THANK YOU