With the prospect of a sharp recovery in economic activities in 2021, corporate banking in India is expected to witness a significant evolution in the path to recovery as banks redesign their corporate customer experience (CX) on a digitalized scale by leveraging technology and innovations.
Compared with developed economies, India’s corporate banking sector is still in its nascent stage in terms of product and service offerings. However, this is being tested on twin counts of increasing digitalization of the Indian economy and globalization of Indian companies, which are bringing in rapid sophistication in operations and engagement.
"In India, corporate banking has remained undelivered during the last couple of years, but going forward, the scenario might change as the threat of the COVID-19 pandemic dwindles and the prospect of India playing a key role in the revival of global supply chain environments gain momentum," said Ganesh Vasudevan, research director, IDC Financial Insights Asia/Pacific.
Corporates are increasingly relying upon their bankers to help them with their working capital contingencies while supporting them in seizing the emerging opportunities. Under these circumstances, banks have the unique opportunity to respond to the corporates' growing need for real-time information flow, financial advice, and funding support.
Vasudevan said collaboration is the order of the day, with corporates pursuing value and efficiency from their banks.
“Traditional brick-and-mortar businesses are increasingly moving to B2B sales online, and corporates expect their bankers to understand the workflow to provide value-added solutions like seamless counterparty onboarding, provide a credit assessment, and finalize the settlement terms without using the traditional invoicing and collection process,” added Vasudevan.
Corporate banking predictions in India
Predictive liquidity forecasting: COVID-19 forced CFO focus on liquidity. In response, 55% of corporate banks will invest in supporting predictive liquidity management and 60% will upgrade data and connectivity capabilities by 2024.
Cloud-based corporate banking: By 2024, 80% of trade finance and treasury workloads will be running as SaaS or on PaaS architectures.
Open credit decisioning: By 2023, to counter the uncertainty of the pandemic, 60% of corporate banks will be revisiting credit scoring models and prioritizing an open data strategy to improve loan portfolio health.