Baby Bank, Big Steps

India’s youngest lender IDFC Bank has chosen the acquisition route to gain a foothold in rural India while building a digital network to expand in urban areas. It cannot afford to slip up as the battle to reach the unbanked gets fiercer

- Salil Panchal

Once a fortnight, the senior management of IDFC Bank, 35 in number, gather for what they call the ‘Safe Space’ meeting at its headquarters in Mumbai’s Bandra-Kurla Complex. It is here that Rajiv Lall, the bank’s founder MD and CEO, outlines the areas of concern for India’s youngest bank.

There are debates, discussions and the odd slanging matches too. The meeting, says Lall, “helps to break communication barriers and enables the individuals, who are empowered at different levels, to problem-solve, instead of following top-down instructions from the boss”. Sessions like these—typical of many modern private lenders in the country—reflect the keenness and agility to resolve issues before they blow out of proportion and are a far cry from banks’ traditional mode of functioning—in silos, where teams build and run products and service lines, often disjointed.

For IDFC Bank, these sessions have proved useful in untangling knotty problems. For instance, it was in a Safe Space session in January this year that the bank discussed the differing interpretations of compliance requirements to set up bank accounts electronically and arrived at a consensus. A directive from the top management ensured that all the departments of the bank were on the same page and did not come up with conflicting analyses of the norms.

Debates have also helped to outline the scope of IDFC Bank’s products such as micro-ATMs that the bank installs in shops to facilitate everything from opening an account to accepting deposits.