The inaugural Pitch BFSI summit, held in Mumbai this week, witnessed a keynote discussion between V. Vaidyanathan, MD & CEO, IDFC First Bank, and Dr. Annurag Batra, Chairman and Editor-in-Chief, BW BusinessWorld and Founder, exchange4media Group.

The discussion was on the topic - BFSI: Today and Beyond. They exchanged insights on the key drivers of growth in the BFSI ecosystem, digital transformation and consumer expectations, and the Fintech revolution in India as well as the road ahead.

The discussion started with Vaidyanathan being posed with a query about the actual business of going around to build a bank and whether it was true that it was like preparing for a marathon. Acknowledging that it was true, he said: “We have to think that you're building a bank in eternity, not even a marathon. And when you think in terms of building a bank to eternity, then you have to build a very, very strong foundation. So at least in our bank for the last four or five years, we've been thinking of building a good foundation.”

Asked what was driving the growth of the banking financial service sector, Vaidyanathan replied, “India got independence in 1947. And let me say, eight to 10 years ago, like 400 to 500 million people in the country did not even have a bank account. Forget getting a loan or insurance or mutual funds, all that is far away. You don't have a bank account. When India lived in 800 AD or 1000 AD, at that time, people did not have bank accounts. 110 years ago, people didn't have bank accounts, which means India lived like how people lived 1000 years ago, and that's bad. But in the last 10 years, magic has happened. Not only have people got a bank account, which is well talked about already, ecosystem around banking in the country itself has also come about. And it’s not just the banks, but systems like the whole telecom network have come. So, all of these make a pretty terrific combination.”

“I say that India has fast-forwarded a lot. I hope every one of you will experience it and therefore you can understand what I'm saying about the last eight or 10 years. India has fast-forwarded like crazy. I'm saying that at least one part of India, maybe 30-40% of India, lived in the medieval age. But in at least the last eight or 10 years, massive things have happened. The biggest thing that has happened according to me is identity because people did not have an identity earlier.”

Vaidyanathan then spoke about how IDFC had abolished all fees, whether processing accounts or transfers, or credit card and debit card fees, a move that was appreciated by customers and helped the bank broaden its base and reach.

Dr Batra then noted that even though IDFC was cutting down on its ad spending, its deposits were growing and asked Mr. Vaidyanathan what he attributed that phenomenon to.

“This is something that really everyone is asking us. The thing is that our bank evokes trust and we cannot say trust me, trust me, people. It doesn't work like that. So, I'd say that that one is the brand, then how we position the brand, and how we provide services. All of these factors play a role, but most important is service.”

Dr Batra observed that we live in interesting times, wherein the lines between various industries are blurring, and the term fintech has become a sort of catch-all term, and so where did Vaidyanathan see the future heading?

“This is a very important question. You can seamlessly migrate from one medium to the other. You can go from social media to integrating the journey of a bank account opening to going to a Flipkart or Amazon. They're giving you an account and you could take a loan for example, and you're taking the digital way. So, the various categories of providers of service, from healthcare, gaming, entertainment education, or even social media are all seamlessly moving together. So definitely lines are blurring, not just between financial players like we talked about, but even outside the financial system.”