Tuesday, December 11, 2007

Leaders & Laggards among Public Sector Banks

With the era of new age banking dawning, the PSBs ( Public Sector Banks ) have also woken up from their slumber. They have finally woken up to technology-enabled banking. Some have taken the lead, others lag:

State Bank of Patiala (SBP) - First PSB to have all branches CBS-enabled. Yes, you read it right every branch of SBP even in the tiniest of villages is CBS (Core Banking Solution) enabled, which means that you can operate your account from any of its branches. Although this would cease to matter anymore, since SBP is going to be merged with SBI.

Corporation Bank (Corp) - In terms of technology adoption, Corp has always been the leader. Whether it is internet banking, debit cards or the recently introduced mobile-commerce, it has always been the first PSB to adopt it. Even the website of this Mangalore-based bank looks decent enough ( better than most PSBs including SBI ).

Karnataka Bank & Andhra Bank - Not to be left behind are these two banks from the South, who have a decent network of ATMs and CBS branches ( atleast in the South and are trying to expand in the North India as well ).

Punjab National Bank (PNB) - Most ( if not all ) branches of PNB are CBS-enabled and one good thing about PNB is that account-holders at a CBS branch by default get a payable-at-par cheque book. Though they have been a laggard on the ATM front. I haven't seen many of their ATMs other than at branches. They have a tie-up with Geojit for providing depository and trading services.

State Bank of India (SBI) - SBI has stepped into so many domains at the same time that it has become almost unmanageable ( atleast for its branch managers ). SBI ( along with its subsidaries ) does have the largest network of ATMs in the country. Recently they have introduced the concept of 3-in-1 trading account in partnership with Motilal Oswal.

UCO Bank & Union Bank of India - After being in financial trouble for few years these two banks have not only improved their balance sheet positions but their services as well. UCO Bank has been rapidly expanding, opening up new branches. You can find ATMs at almost all of their urban branches.

Among the PSBs which haven't shown any willingness to upgrade, Indian Bank tops the list. Its branches, still give you that feeling of a dingy government office (the image which is normally projected in hindi movies).

Hope some day our PSBs would be able to measure upto the services offered by the international banks [ but should not measure upto their charges ;-) ].

Update : Karnataka Bank is not a PSU Bank. Thanks Narsi!

Thursday, December 6, 2007

I pity the SBI Manager

With SBI ( State Bank of India ) distributing their Insurance, Credit Card and Mutual Fund products through their wide network of branches, as well as modernizing their banking operations ( offering facilities like Internet Banking, Debit Card etc. ) life has become a lot easier for all but one group of persons.. the managers of SBI branches.

At an SBI branch
- if you need Internet Banking password, you need to approach the Manager.
- Applying for SBI Debit Card? submit the form to the Branch Manager.
- Want to purchase Mutual Fund units? Approach the Manager.
- SBI Life Insurance products? Approach the Mananger.

All this over and above his ( Manager's ) existing responsibilities ( which includes attending to their High Net-worth clients ).

All this, leads to a scenario, where there is always a long queue of people waiting outside the Manager's cabin. This is unlike other banks ( public or private sector ), where there are dedicated personnel for each of these products ( viz. Mutual Funds, Insurance, Cards etc. )
Perhaps, SBI can do a little favour to their managers ( and their customers as well ! ) by implementing a system similar to the other banks.

Tuesday, December 4, 2007

Citibank - Not safe

Would you place your most precious item in care of somebody who is careless, reckless and cannot take care of his/her own items?

Well its the same with Citibank. It has always been in deep trouble with respect to its finances. If they can't manage their own, then how do they expect to manage your money ( call themselves a bank!! ).

When Citibank was in deep trouble in 1990s, the Saudi prince Al-Waleed rescued it by buying a substantial portion of it and pumping in the much-needed capital.
Now with the sub-prime bubble bursting, it is finding itself in troubled waters again. Who would rescue it now?

The lesson for you, don't keep your life savings with Citibank. Keep it in one of the Indian banks where the deposit is atleast guaranteed by the Deposit Insurance and Credit Guarantee Corporation DICGC ( upto Rs. 1 lakh ). The Citibank deposits are not guaranteed by DICGC, while most other banks' deposits ( including ICICI and HDFC ) are guaranteed by DICGC.

HSBC Credit Cards - Not for the Indian middle class

I have tried out almost all the credit cards offered by different banks in India. No, this is not my hobby but I have been almost forced by the call center guys to get one and which I promptly cancelled within an year of issue.

The HSBC credit card is for those who dine at the Oberoi and stay at the Taj when travelling and go on Star Cruise every six months. Well, that the kind of discounts they offer you if you are an HSBC credit card member.
Tell me honestly how many times have you been to a Taj or an Oberoi with your family ( but not as part of official meets ). Compare this with the kind of discounts offered by other credit card companies on Air ticket booking, or at Petrol pumps, or on electronic items which you may indeed want and would buy.

Or is the HSBC strategy different, people are encouraged to spend more at expensive restaurants so that they end up paying more money as interest to HSBC. Huh?.. good one, but I won't be fooled by it, and you also be not!!

Sunday, December 2, 2007

ICICIdirect.com - Avoid it to save money

The above title is incomplete. You must avoid ICICIdirect.com to save your money as well as to avoid high BP.

Well if you have already dealt with ICICIdirect, then you would know what I mean. In case you have not here a shortened version of the long list of "Whats wrong with ICICIdirect"

- Highest brokerage. I never seen ( or even heard ) of any brokerage house charging as high as the ICICIdirect.com does 0.75 % !!! You will lose almost 2% of the transaction value on a delivery-based buy and sell transaction.

- Website. This is second most important reason not to use ICICIdirect.com. Apart from regular downtimes for the ICICI website, any day the sensex loses heavily, the website would be down. There are so many users and their servers just can't cope up. Reminds me of the tag line "Part of a crowd or Stand apart".

- Customer Service. How would you like your hair cut done by an untrained professional. Can't imagine how would you look? Well similar is the case with ICICI. Most of its personnel ( atleast those who interact with the customers ) are fresh out of college, in this job just to earn quick money. Ask about the procedure for resolution of an issue to 3 different people, you would get 3 different answers ( wanna bet?? ).

- Still not satisfied? Want more reasons not to deal with ICICIdirect.com? See the review on mouthshut.com here.

I think that was enough bashing ICICIdirect.com for today. Will write, next article soon.