Someone has very correctly said, economics, linking dynamic human behaviour with the concept of money, is the mother of all social sciences.
And who better to give us insights of this wonderful subject than Mr. Sunandan Chaudhuri, currently Senior Economist at ICICI Bank. An important contributor to financial dailies on issues spanning the Indian economy and macroeconomic policy making, Mr. Chaudhuri is one of the leading economists of the nation. An alumnus of the prestigious Presidency College, Kolkata and the coveted Indian Statistical Institute, Mr. Chaudhuri, before joining ICICI bank, had worked with organizations like SBICAP Securities and Tata Consultancy Services.
The students of IIM Kozhikode got an opportunity to interact and learn from a person of such credentials and expertize of economics during the Vertical Summit 2016 organized by the Industry Interaction Cell, IIM Kozhikode. Here are a few excerpts from his interview-
Your thoughts on the actual working environment in the financial services sector.
In India, the financial services sector is in a growing stage. Owing to the relatively under banked nature of our economy, financial services as a sector has enormous potential to grow as the GDP growth moves towards the 8% mark in the years to come. The ‘JAM’ (Jan Dhan – Aadhar – Mobile) trinity, supported by the Government of India is a huge fillip to financial inclusion in this context and the demand for financial services is poised to increase in the years to come.
What are the challenges and opportunities in the banking sector and how must we as students prepare for it?
This rapidly evolving and dynamic sector needs people with a certain set of ‘internal’ as well as ‘external’ skills. As a bank is basically in the business of managing risks, it needs people with good analytical skills to perform various risk management and credit disbursement functions. The present day banker needs to be tech savvy as the platform gets increasingly digitized with the introduction on online wallets, payments banks, and potential competition from P2P and crowd funding, which would be driven on a strong IT backbone.
On the ‘product’ front this involves an external set of characteristics, and a banker must be able to adequately communicate the relevant value proposition to all the stakeholders involved. The focus currently is on retail credit growth and, a bank needs people with good interpersonal skills, who are able to connect with its customers.
With the coming up of the digitized platform and ever falling data rates, how do you see the future of the brick and mortar of retail banking outlets?
The brick and mortar model has served India’s banking system for a long time. At this stage, there are strong complementarities between the traditional brick and mortar and digital processes. As we are still a largely under banked system, the scope for traditional banking provides brick and mortar outlets enough space to operate and exist in the near future. Over time digitization will gain prominence, but there would conceivably be more co-operation than competition.
What could be the likely impact of the expected outflow of FCNR deposits on the tune of around USD $20 bn on the Indian economy? Are we adequately prepared for it?
The outgoing RBI Governor Dr. Rajan has time and again assured that the RBI is well positioned both in terms of its ability to supply dollars and also in terms of its ability to maintain adequate rupee liquidity. Currently our reserves are at a historic high .Again, because of superlative growth performance as well as yield seeking behaviour from investors globally, the large foreign capital inflow of FDI as well as FII enhance the available forex kitty. Thus the RBI is adequately equipped both in terms of rupee liquidity and dollar liquidity to tackle this outflow.
What are the recent traits in the B-school graduates that join banking institutions and any one quality that you would like us to work and improve on?
Over time, students have become more comfortable with a faster pace of outcomes which is not out of place, as with quick turnaround times in business, such dynamic qualities are required. But at times, it helps to take a certain medium to long term view of one’s career, which of course comes with maturity. So balancing the abilities to learn fast with a medium to long term view of one’s career direction is what one would like to see in today’s B-school graduates.
Interviewed by Rahul | Public Relations Cell – IIM Kozhikode