'Banks must innovate to be competitive'

Ramani KANGARAARACHCHI

Banks must always focus on innovation to remain competitive to take a leadership position because the future of banking relies on significant customer inspiring innovations. Sampath Bank Senior Manager, Priam Kasturiratna said at the National Information Technology Conference 2011 recently.

He said if banks do not innovate, eventually someone else will innovate and enter into the bankers' market. Banking innovations must at least deliver basic services through all stable and popular channels and multiple technologies so that the customers will not be detached from their banks.

Kasturiratna said the banks also should recognize customer requirements and stay one step ahead of them focusing on customer experience. It is very important to recognize the fact that being innovative today will never be a final success destination, but just a status in a continuous mechanism of organisational success.

Referring to risks of decline in banking innovations he said a bank may have a well built infrastructure and good internal procedures but none of them would guarantee achievement of business goals and long-term sustainability unless correct strategic decisions are taken by the top management. Since none of the banks are enjoying the monopoly condition they need to compete among themselves and at the same time will have to compete with small scale innovators trying to enter into the banking market share.

Kasturiratna said Sri Lankan mobile operators entering the traditional banking business accepting deposits is a good example of banks being outsmarted in innovation. Over a period of time ,this opening can facilitate a series of other banking like services for the rural or untapped market sectors that have not yet been approached by the banks, he said.