Indian Institute of Banking Finance A Virtual Institute

Indian Institute of Banking & Finance ® A Virtual Institute for Talent Management: Vision To be the premier Institute for developing and nurturing competent professionals in banking and finance field R. Bhaskaran 26 th August 1

IIBF- The travel Established in 1928 (section 25 Company)- offering professional banking qualification / certification for bank/FI employees. Supported by the industry. Governed by Banks, RBI, F. I’s & Academicians. Examinations, twice a year- nearly 300 centers in the country. Own and accredited class rooms across the country. Early 80’s handled huge physical load of descriptive answer papers each half year Exams – till 2004 were in descriptive in nature Profile of Candidates : Heterogeneous Now the exams are mostly in multiple choice mode and distance learning is made possible by use of technology. R. Bhaskaran 26 th August 2

Education/Training Needs of the sector Knowledge and skill inputs for the new recruits Specialized Knowledge in new areas of business (verticals) and regular updates for existing employees Specific process knowledge for service providers such as Soft ware companies, Debt Collection agents, Mortgage advisors, financial advisors, Business correspondents. Domain knowledge for marketing and other agencies Courses and Exams in multiple languages Leadership in different geographies and levels Existing training capacity with banks and FI’s may not be sufficient to meet all the needs. Colleges do not provide vertical specific knowledge. Training efficiency can be improved if education and training go hand in glove. IIBF will focus on areas where education can supplement training R. Bhaskaran 26 th August 3

TNA Personnel Requirements Front line staff Basic knowledge, Product delivery skills and Customer Acquisition and Service Back-office- Service Basic Knowledge- procedural skills Delivery Channel Employees Product knowledge-Process skills. Speaking skills- Selling skills- Dos and Don’ts Officers Financial Advising- Credit appraisal. Marketing Specialist officers High skill levels in the vertical Management Product knowledge, Specialist knowledge and Stake holder management Boards Big picture Governance- Policy making R. Bhaskaran. 8/27/2011 4

IIBF’s Approach to courses ◦ IIBF’s focus is on designing, developing and offering courses which give common denominator knowledge in the given subject/vertical to the employees of the bank/FI such that employers can save on cost and time in training the staff. ◦ This will enable banks/Financial Institutions to focus on their products and customers, in their in house training efforts. ◦ IIBF avoids duplication of efforts/courses and competition with other Institutes and training institutions so that the sector gets relevant courses from the Institute. ◦ Offer relevant courses as value addition in a cost effective manner. R. Bhaskaran 26 th August 5

The Process: Design & development Need Analysis: Based on views/suggestions/feedback from banks in formal and informal meeting the needs are identified and concept papers prepared Conceptualization: : Concept note and contents improved by discussion with SME, Department heads , HR heads to arrive at course outline and syllabus. The focus on being relevant to banks. Approvals: From SME : HR departments. Approval from Education Governing Council , Examination and Content development: Based on the syllabus/ modules courseware is prepared by SMEs. The contents are vetted by practitioners ( two levels) R. Bhaskaran 26 th August 6

Pedagogy Book Courseware Updates portal Study Support Mock Test IIBF Vision Work Book Contact Classes Course Delivery Web Lectures E-Learning JAIIB DTIRM Testing AML/KYC Customer Service Online Project Finance Paper & Pencil R. Bhaskaran 26 th August 7

Delivery : Virtual Institute: More than an open University. The need for physical intervention is over come and cost can be contained On-line testing USP Each and every Candidate to get access to all offerings Web-Virtual Classessments on-line E-learning Portal. Online services Courseware E-Book R. Bhaskaran 26 th August 8

To-day: IIBF: largest of its kind 23 courses – 46 subjects. Diplomas and certificates have recorded 50 K number. IIBF offers customized Nearly 230000 candidates in 2010 -11 exams in Sri Lanka E- Learning for Core Banking Zambia. TBA in Nepal & PNG E-learning for JAIIB 65000 candidates E-Course for employees of RBI on Treasury Management- 500 candidates. E-Learning for Treasury 400 candidates per half year Simulation for customer service E-course for induction training of bank employees. Web Classes for the major examinations On-line payments- candidate services On-line proctored tests for majority of exams 80% of courses covered by e-learning, web classes and on-line testing by end of 2011. Most exams in multiple choice- objective mode R. Bhaskaran 26 th August 9

Courses are offered to the employees of Banks Reserve Bank of India Financial Institutions And Graduate students Mutual Funds IT/BPO companies Business Correspondents ( financial inclusion) Micro Finance Institutions Financial Advisors/Wealth Managers Debt Recovery Agencies Home Loan Companies Non Bank Finance Companies R. Bhaskaran 26 th August 10

Thousands 180 associate & Certificate 5 4, 5 160 Thousands Performance Candidates enrolled for various examinations JAIIB/CA IIB Diploma and DB&F 4 140 Certificat es 3, 5 120 AMP 3 100 2, 5 DB&F 80 2 Diplomas 60 1, 5 40 1 20 0, 5 0 0 2005 -06 2006 -07 2007 -08 2008 -09 2009 -10 2010 -11 Year R. Bhaskaran 26 th August 11

Courses Flagship Diplomas Certificate others Management JAIIB Treasury Trade Finance DRA AMP CAIIB Internation al Banking AML/KYC BCBF Project DB&F Banking Tech Credit Cards IT/BFS MBA by IGNOU Urban Banks SME BPO/IT Commodity Derivatives Information System Micro Finance QT Financial Advising Customer Service E-Course for induction • ALM • Compliance • RRB • Forensic for banks Home loans R. Bhaskaran 26 th August 12

R. Bhaskaran 26 th August 13

v Home loan is possibly most important financial decisions taken during the lifetime of a consumer. v v Rapid economic growth has accelerated demand for huge infrastructure and housing projects. The Home loans are on the increase v Adequate and effective measures needed to - v guide the consumer; v safeguard consumers’ interest and v sustain growth of the sector on healthy and sound lines. v This has necessitated demand for home loan advisors who are expected to have knowledge about legal, regulatory and other aspects of home finance. R. Bhaskaran 26 th August 14

What is important for home loan borrowers? Able to access information which is simple, clear and understandable and not ambiguous or misleading. The details of requirements for taking loans and their interpretations clearly explained by lenders and understood by consumers / borrowers. Fair treatment: post disbursement: being kept informed of relevant changes to their loan terms and conditions, where applicable. Consumers, however, need to take decisions on their own and are responsible for their decisions. Lenders can do the above but their resources are better used for appraisal and lending. The advising can be outsourced R. Bhaskaran 26 th August 15

Present Status Presently, prospective house/flat buyers take the services of Direct Sales Agents of banks/ HFCs or other agents who provide advice which is often limited and possibly biased. No standard or uniformity in the quality of their advice. What can be done World over there is the machinery of mortgage advisors (mandatory) to help/advise the borrowers If implemented with controls this would not only enhance fairness and transparency in housing finance but would also be a good service to the borrowers & mortgage originators as well. R. Bhaskaran 26 th August 16

CIMCs: How consumers will benefit? Consumers’ interest will be best served as he / she will have an unbiased opinion. Big picture regarding terms & conditions of all institutions will be available. Can make well thought of and informed decisions. Will become more aware about credit underwriting process and debt management. CIMCs can also guide consumers on other aspects like the need for making a will / home loan insurance / RML (senior citizens) Concerns: CIMCs may push some products for their benefit- there is a need for an Industry driven SRO R. Bhaskaran 26 th August 17

CIMCs: How consumers will benefit? CIMCs can be a one point stop for consumers if documentation / search reports etc can be facilitated by the counsellor. Post sanction, if issues arise, consumer can continue to get guidance and advice from the CIMCs. This is particularly true now as interest rates have been rising. Due to this, either the loan period goes up or the EMI or both in certain cases. Debt management therefore becomes crucial. R. Bhaskaran 26 th August 18

CIMCs: How banks / HLCs will benefit? Banks / HLCs will encourage the use of the services of professionals who have acquired the necessary qualifications / experience in the field. The CIMC will be the link between bank / HLC and consumer. This will reduce the Transaction Costs of banks / HLCs in the long run. Process time can be reduced. Miss selling will come down. R. Bhaskaran 26 th August 19

Will CIMCs find value? CIMCs will get an advising fee. They can have additional sources of income by taking up other advising business as well. If mandated, will attract more CIMCs to take this up as an independent avocation. R. Bhaskaran 26 th August 20

Home Loans -- Steps taken by IIBF The suggestion for a course on home loan came from banks In consultation with NHB, introduced a diploma course in Home Loan and Home Loan Advising. Developed specially designed courseware for the diploma. Courseware vetted by officers of NHB + LIC Housing Finance. Introduced the course in 2007 -08. So far, around 400 candidates have cleared the examination. R. Bhaskaran 26 th August 21

Diploma in Home Loan Advising The course has two papers: Paper I – Essentials of Home Loan – Practice & Procedure Paper II – Home Loan Counseling. Specific books have been published. Paper I has 10 units and Paper II has 12 units covering all essential aspects of home loan advising including AML, KYC, legal aspects, tax planning, types of mortgages etc. R. Bhaskaran 26 th August 22

Diploma in Home Loan Advising While introducing the course, in consultation with NHB, it was mentioned that successful candidates will be eligible for award of “Certified Independent Mortgage Counselor / Advisor”. The CIMC will be awarded by an SRO of lenders and CIMCs. Alternatively IIBF can be authorized to issue the certification. Either way, candidates must not only pass but has to fulfill some legibility criteria. This presentation, will hopefully lead to the formation of SRO HLC and Banks must encourage the CIMC concept. R. Bhaskaran 26 th August 23

Debt Recovery Agents Training and Certification R. Bhaskaran 26 th August 24

Debt Recovery Agents The Debt Recovery Agent (DRA) course by IIBF was designed based on advice of RBI/IBA. This is a 100 hour training cum certification for recovery agents. Banks / NBFCs have to employ only those DRAs who have undergone the requisite training from institutions accredited by IIBF and have obtained certificate from IIBF. DRA course started by IIBF in 2008 and being conducted in 11 languages As on date, 53, 912 candidates have passed this exam. It has impacted the sector positively. At the same time there is the expense on getting the agents certified. Suggest the same for Home Loan sector also R. Bhaskaran 26 th August 25

Thanks R. Bhaskaran 26 th August 26