Tata Capital which is part of India’s largest conglomerate Tata Sons, is among the top 10 NBFCs in the country. With a book size of over Rs 77,000 crore, it currently operates in 196 locations and has over 17,50,000 customers. With the annual growth of 28%, the company made a profit of Rs 972 crore in 2018- 19.
Tata Capital is focusing more on voice and video communication to deliver credit solutions, process loan applications and disburse them instantly with less human intervention. Here’s how the company is building and planning a digital lending ecosystem.
Tia – Voice Bot: Serve customers
Tata capital recently launched a voice bot “Tia”, since new era customers are interested in voice communication for their needs.
“Our main focus is customer experience, and what we’ve seen is that the trend is voice-driven, and voice usage in India is very high. As seen in both the Google search and in the use of voice assistance. We felt that in the lending space, voice was not used,” said Abonty BanerjeeMarketing and Digital Director, Tata Capital.
Tia a voice bot that helps track a customer’s loan journey. One in five or sometimes one in four customers use it. Tia also has a Hindi version.
Tata Capital is actively investing and pulling out other offerings in voice, as we believe that in the younger generation as well, all digital media interactions are slowly shifting more and more towards voice, “you would have cousins/nephews, they don’t type much, they talk,” Banerjee added.
The ratio of most voice queries converted into real applications is really high.
Transforming the distributor journey
Distribution is an integral part of financial institutions. Tata Cap is working to reinvent distributor journeys.
“What we’re trying to do is — right off the bat all the data entry. So if I’m offering you a loan and I’m a direct selling agent (DSA). I’ll come to you, I’ll do the most minimal data entry on my phone itself i will do some validation with you to make sure you are genuine you will send me an OTP and then i will just click pictures of your document and it goes into our So we’re kind of reimagining that journey, obviously it’s done: with that, we’re transforming the customer journey and gaining productivity,” Banerjee explained.
Automation of robotic processes (RPA) has been widely used in all industries. Financial institutions use it for different categories of services. Tata Cap wants his Robots to make all the decisions.
“Robotics is a new adventure for Tata Capital. Our first phase is almost implemented now. We are trying to move to a place where all decisions are made based on data. Whether it’s in customer acquisition, whether it’s in underwriting, whether it’s in collections,” Banerjee said.
Currently, over 80% of Tata’s cap loans (by volume) would be sanctioned using RPA. In addition, in the entire area of collections, the company uses at least 25 to 30 scorecards. The complete acquisition of customers, pre-qualified and eligible customers, is based on a well-established analytical framework.
Tata Capital uses software robotics, for reconciliation. Basically for things that are repetitive in nature.
“For example, you have to grab the RC book – you have to log into the Vahan site, get the RC copy and update it in your main system. Previously, this was a very manual process. You would have a be human who would pick up that RC copy from that branch, send it to the central log, and then they would do the data entry. Now it’s fully automated, you have a license, you can access the branch site. In fact , a bot does it. It is important to note that it can work 24 hours a day, it is also a big saving,” she added.
The idea is to make the loan process efficient at all stages.
All financial institutions talk about customer satisfaction. But are customers ready for it?
“Yes.” Banerjee said confidently.
“Currently we have two use cases – one where the wealth manager is chatting with you – clients do that very comfortably, in some cases it’s underwriting, so in some cases clients can be less comfortable because you ask them questions related to their bank statements, etc. We launched a specific segment for SMEs and 25-30% prefer to log in themselves, she said.
Tata Capital has recently equipped itself with a digital 2.0 SME platform. The objective is to assess the profile and disburse the loan as soon as possible.
“We look at all the information shared by customers and the documents they upload. And we make a final decision; it is a sanction letter generated by the system. In low cost loans, this happens within hours. What we tried to do is that even if it takes a day, we give final approval,” Banerjee said.
This allows Tata Capital to offer smaller loan sizes with less labor and it also allows them to enter a new market. The idea is also that Tata Cap does not want to use too much manpower to reduce the loan amount. The company sanctions up to Rs 50 lakhs within 3 to 4 hours and on the same platform, it can sanction loans up to Rs 20 crore using the same scorecard.
The future of loans
Tata Capital has partnered with a dozen FinTechs that offer various services.
“It’s about transforming the organization into whatever technology is available to you. So we try to transform every part of our business with the help of technology and we try to derive benefits from it in terms of customer satisfaction or productivity, that’s our mantra. We’re trying to transform how more data, using more technology than we use,”
The company also works on niche segments. For example, giving early loans to specific segments. They are building a workflow in this segment that is digital end-to-end. They want to focus on changing the way the whole organization works and take advantage of all the technological innovations that are currently possible, whether it’s using the cloud, using robotics in operation or the use in the subscription.
Launching a whole new bank and saying it’s completely digital is a model, but for an existing business the biggest meaning is to transform the business itself, that’s how I see it, Banerjee said.