44 India's Best IT Implementations of the year 2005

Continued from page: 8

Friday, June 03, 2005

Centralized Core Banking Punjab National Bank

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Project Head: K S Bajwa, GM-IT 
Location: All branches of PNB across the country

Punjab National Bank is a 110 years old bank, and its employees are used to working in a particular way. Introduction of the core banking solution required a dramatic shift in their orientation. People who were used to following traditional banking processes had to be trained to use the new system. So in effect, implementing the core banking system wasn't the biggest challenge. 

Even more challenging was the task of bringing in this change management. People had to be trained in phases, so that bank's existing operations didn't get affected. Another major challenge was managing so many different vendors, which had to be handled very carefully. Another major challange for the bank was handling vendors such a huge implementationwould obvioulsy involve multiple vendors. It was a challange for the bank to get the best support.

The project started way back in 2001. So far, the bank has managed to implement the core banking solution across 1050 of its 4500 branches across the country, some of which are in the remotest of areas. 

The bank has used all possible communication links for different branches, depending upon the requirement. These included everything from leased lines to VSATs, radio frequency, etc and even different service providers. Such a wide mix of communication equipment is necessary considering that the bank has branches even in areas where the basic infrastructureitself doesn't exist. 

The scope of this project was to centralize the core banking solution so that a single customer database is maintained to provide a consolidated view of the bank's operations. This way, the customers would belong to the bank and not any particular branch. The branches would function as the delivery channels, managing customer accounts. 

The result of centralizing the database was that the bank could build a strong MIS for strategic decision-making. A more long-term objective of having centralized database is to build a data warehouse with a cross sell application on top of it for all customers. Currently it's functional only for the bank's premium customers. 

The Centralized Banking Solution has made it easier for Punjab National Bank to provide customers anytime, anywhere banking service. It has also integrated various delivery channels like ATM, tele-banking, Internet banking, debit/credit/smart cards, etc. This allows the bank to attract and retain the right customers, and business in the core branches has grown by as much as 2.5 times. 

The bank uses a three-tier architecture with multiple delivery channels integrated to provide a unified enterprise banking system. There have been other challenges that have been managed here as well.

For instance, security risks in Internet banking are huge. For this, besides having a proper security infrastructure, the bank also provides a virtual keyboard for customers to enter their account details. Other issues like other people using the bank's domain name for malicious intent have also been resolved. The bank also has a remote DR site in Mumbai, which is asynchronous. Another synchronous DR site is also being considered. Plus a risk management system is also being deployed. 

Cost of doing such a massive implementation, of course, runs into hundreds of crores of rupees. Of course, even the team size for deploying such a project has to be huge. It consisted of 80 people, who brought several skill sets to the table, such as DBA, reporting, help desk support, quality control, project management, etc.

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