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Microsoft Windows Server System

Customer Solution Case Study

Punjab National Bank Dramatically Improves

Rural Banking in India

Overview “The Windows Server 2003–based solution was easy

Country or Region: India
Industry: Banking
to implement as well as maintain remotely across our
network of far-flung rural branches.”
Customer Profile
K. S. Bajwa, General Manager–IT, Punjab National Bank
Punjab National Bank (PNB) is one of the
leading public sector banks in India. It has
a large retail-banking network of over
Punjab National Bank (PNB) is one of the 500 largest banks in the
4,400 branches and service counters that
spreads out into far-flung and remote world, and enjoys a rich history and heritage. PNB was the first
Indian bank to be started solely with Indian capital. Established in
Business Situation 1895 at Lahore, and nationalized in 1969, it has worked
PNB was faced with the prospect of
assiduously to build the banking sector in rural and urban India. It
increased competition from new private
and international banks. It also faced the has presence in remote areas of the country, cutting across cultural
challenge of linking all of its branch
and linguistic boundaries. Computerization of the branches for data
operations into a cohesive entity to serve
its customers. The bank's operations serve accuracy, operational ease, facilitation of customer interaction with
a widespread population that speaks many
banking products, and centralization of data was of concern for
different languages.
remote branches. One of the important reasons for choosing
BancMate—a multilingual Total Branch Automation (TBA) package
PNB chose BancMate from Natural
Technologies to run its branch banking for rural and semi-urban branches—was that it is based on
operations on Microsoft® Windows
Microsoft® Windows Server System™, which provides ease of
Server™ 2003 and Microsoft SQL Server™
2000. learning and intuitiveness, as well as the ability to easily implement
and support solutions based on it.
 Bilingual software improves customer
 Easy to implement and troubleshoot.
 User friendly, cuts training time.
 Scalable from very small to large.
“We chose BancMate as Situation PCs. As the next step, PNB needed to find a
The Punjab National Bank (PNB) enjoys a solution that would automate its business
our rural banking long and rich history; established in 1895, in processes and link the existing PC "islands"
solution because it is a Lahore, in the then undivided India, it was the into a more meaningful and manageable
first bank to be started solely with Indian network.
robust solution. capital. Subsequent to the partition of the
Together with the Windows country, PNB was popularly known as an Business Situation
Indian Bank. As part of the nationalization of Meanwhile, the banking environment in the
Server 2003
and SQL
and banks that happened in 1969, PNB was also country had undergone a sea change, with
Server 2000,
it has
it has
never nationalized. private banks and international operators
entering the fray, and both retail and
given us
never given
any In Today, PNB operates 4,070 branches and corporate banking operations becoming
IT staffnew 443 service counters across the country, increasingly competitive and under cost
consolidating its position as one of the top pressure. Effectiveness of customer
IT staff members
also findalso
it nationalized banks of India. PNB has been interactions was also coming under pressure
find adapt
to adapt
to the to ranked at 395th position amongst the top with rising business volumes.
1000 global banks by the prestigious
solution.” international publication The Banker. IT Infrastructure at PNB
K. S. Bajwa, General Manager - IT, Punjab With technology emerging as a key driver of
National Bank Like other scheduled banks in India, the PNB business growth, the bank has taken a
also comes under the guidance of the number of IT initiatives to provide its large
Reserve Bank of India (RBI) and as a clientele spread all across the country with
government establishment, it has to follow the best of technology while retaining the all-
directions of the government. Two directives, essential human warmth. Its core banking
one from the Reserve Bank of India and the system (CBS) already acts as a single data
other from India's Department of Official bank, a backbone to 2,108 service outlets
languages are key in this context. In 1985, with internet banking services spread over 28
the Department of Official Languages states in the country. This deployment has
mandated that all electronic equipment used lent PNB the status of being the largest core
in ministries and departments of the banking system in Asia.
government and their attached and
subordinate offices would need to be The bank has 676 ATMs and also coordinates
bilingual. That is, they should be able to with the MITR group of six banks with 2,200
“We have been able to handle both Hindi and English. By the year ATMs. PNB is a member of Institute
2000, the Reserve Bank of India had Development and Research in Banking
deploy the BancMate mandated that banks should have a clear IT Technology (IDRBT)-sponsored National
solution at over 2,300 plan that should be implemented: that at Financial Switch (NFS) for mutual ATM
least 70 percent of all branches should be transactions. NFS at present has 18 banks
branches in India over computerized. and a pool of 6,197 ATMs. PNB has also
the last two years, which pioneered the cheque truncation system in
At this time, PNB was perhaps the least India. Other software fuelling the systems are
is a unique computerized bank in the country. Not only instant fund transfer mechanism, data
achievement.” that, almost the entire IT team was new. warehouse for decision control and MIS and
From that time onwards, PNB has come a risk management software based on Basel II
long way, winning laurels for its innovative guidelines set by the Bank for International
K. S. Bajwa, General Manager–IT, Punjab approach to IT implementation. It started out Settlements.
National Bank by first purchasing over 4,000 standalone
PNB has so far marketed BancMate (on About 77 percent of its business is connected BancMate for total branch automation and a
a Corporate License basis, i.e., through leased lines, ISDN and VPN. Other total of around 2,400 locations will be
complete banking on BancMate) to: services such as mobile banking, utility bill automated by 2006. “We have been able to
1. United Bank of India payments, funds transfer, e-commerce and deploy the BancMate solution at over 2,300
2. Himachal Pradesh State Coop. Bank CRM through mobile shall be introduced for branches in India over the last two years,
3. Joginedra Central Coop. Bank the PNB branches including setting up a which is a unique achievement,” comments
4. Haryana Ks. Grameen Bank network operating centre (NOC) to monitor K. S. Bajwa, General Manager–IT, Punjab
5. Hissar-Sirsa Ks. Grameen Bank the CBS network. National Bank.
6. Himachal Grameen Bank
7. Shivalik Ks. Grameen Bank Since all the major branches are fully BancMate runs on Microsoft Windows 2000
8. Kapurthala-Ferozpur Ks. Grameen Bank computerized and networked, PNB offers Server and Windows Server 2003, with
9. Gurdaspur Amritsar K G V Bank value-added services like 'anywhere anytime Microsoft SQL Server™ 2000 as the
10. Shekhawati Gramin Bank banking' through ATMs, and Corporate and database. The client runs on Windows 95 and
11. Alwar Bharatpur Anch. Grameen Bank Retail Internet Banking Services. New online later. In smaller branches, a peer-to-peer
12. Bhojpur Rohtas Grameen Bank services have also been developed—bill network on two machines running Windows
13. Magadh Gramin Bank payment, railway ticketing, and payment of 98 provides the infrastructure for running
14. Nalanda Gramin Bank fees. For these initiatives PNB bagged the BancMate.
15. Patliputra Grameen Bank Nasscom Best IT user award in 2004 in the
16. Kisan Gramin Bank BFSI sector. Other acknowledgements: ITIL's It took nine months to customize the 24
17. Devi Patan Ks. Grameen Bank certification for best practices in data modules of BancMate to meet PNB’s needs.
18. Rani Laks.Mi Bai Ks. Grameen Bank centres; BIS certification for 116 offices; ISO The Windows Server System–based solution
19. Vidur Gramin Bank 2000 certification for services. provides an easy-to-understand interface,
20. Muzaffarnagar Ks. Grameen Bank reducing not only installation and support
21. Hindon Gramin Bank Solution costs, but also training costs.
22. Ambala Kurushetra Gramin Bank It was in this context that the IT team set
about evaluating various solutions for retail PNB’s Confidence
automation and settled on BancMate, the Viewing the robustness of the package on the
multilingual solution from Natural Windows platform in all aspects, PNB decided
Technologies Private Limited for retail and to enter into a marketing agreement with
rural banking operations. Natural Technologies to sell out the product
to other banks at a reasonable price.
BancMate is unique in the fact that it is a
multilingual retail-banking package. A user PNB and Natural Technologies have
can simultaneously use two languages within marketed BancMate so far to seven public
the system. Microsoft® Windows Server™ sector banks, 30 regional rural banks, one
2003 operating system (part of Windows private sector bank, one state cooperative
Server System™ integrated server software) bank, and two cooperative banks across 28
was chosen as the implementation platform states of the country.
because of wide familiarity with the platform,
as well as ease of operation and support, Awards for PNB and BancMate
given the far-flung and remote branch PNB itself has gone on to win many awards
network that the bank operates. for its innovative approach to IT
implementation. These awards include the
The roll-out began in 2001 (on Windows® ‘Best Bank Award for Excellence in Banking
2000 Server operating system), and today, Technology’ by the Institute for Development
more than 2,300 branches are using and Research in Banking Technologies,
“We liked BancMate so Hyderabad, and the “Wharton Infosys system and database has never given us any
Business Transformation Award–Enterprise trouble. In addition untrained manpower also
much that we entered Transformation Award’ for technology. PNB finds it easy to adapt to the solution,”
into an agreement with also received the ‘Innovator of the Year,’ explains Bajwa.
award from PC Quest, a leading Indian IT
Natural Technologies to magazine, for bringing in the regional Easy to Troubleshoot
market it to other banks language support for rural banking that is Further, the ease at which networking and
provided in BancMate. configuration could be done—and
in India.” troubleshooting—on the Windows platform
K. S. Bajwa, General Manager- IT, Punjab Benefits meant that PNB was able to get the
National Bank Commenting on the benefits of BancMate infrastructure up and running very fast, even
and Windows Server System, Bajwa says “We in the remotest of branches.
chose BancMate as our rural banking
solution because it is a robust solution. Bilingual Application Software Improves
Together with Windows Server 2003 and SQL Customer Relationship
Server 2000, it has never given us any BancMate enables the bank to meet the
trouble. In addition, new IT staff members directives of the Official Language Act of the
also find it easy to adapt to the solution.” country. BancMate gives the bank the ability
to maintain the database in Hindi and
Easy to Implement English, as required.
The implementation process is simple, fast
and user friendly. In the last two years, PNB The multilingual solution has helped the bank
has been able to implement almost 2,300 maintain a better relationship with its retail
branches to BancMate and plans to complete and rural customers. By providing bank
implementation to an approximate total of statements in the local language, PNB is able
2,400 locations by 2006. Adds Bajwa, “The to bridge the divide in rural locations as well
Windows Server 2003–based solution was as with semi-literate customers. PNB has
easy to implement as well as maintain been able to effectively improve collections
remotely across our network of far-flung rural as well as to reduce bad debts and non
branches.” performing assets in this market segment
effectively. This is primarily due to local
User Friendly Software Cuts Training language support in Windows and BancMate.
The entire retail banking process is covered
in just two screens in BancMate. This makes Scalable from Very Small to Medium
it very easy for bank employees to adopt the Operations
new technology. The advantage of the easy- The scalability of the solution—from a two-
to-use features can be seen from the fact computer network to a larger one—meant
that PNB branches at rural locations have that the bank could save on implementation
been running this solution successfully and costs by right-sizing the infrastructure to the
have not faced any resistance in adoption. needs of the particular branch.

“The simplicity of the Windows interface has

helped reduce training costs by bringing Future Plans
training time down to ten days. We chose PNB has decided to have only two banking
BancMate as our rural banking solution software solutions in the bank, in other
because it is a robust solution. The operating words, either a core banking solution or
“The simplicity of the BancMate. All the branches running on
different legacy software will be migrated to
Windows interface has either of the two solutions by June 2006.
helped reduce training
PNB has chosen Natural Technologies to
costs by bringing develop additional modules on BancMate to
training time down to enhance its features and meet the growing
needs of PNB. These modules are being
ten days..." integrated through a distributed architecture
K. S. Bajwa, General Manager- IT, Punjab with BancMate and a centralized architecture
National Bank comprised of the bank’s core banking
solution. These modules are:
 Proposal tracking solution to manage
business proposals.
 Collection of excise and sales tax as per
government of India regulations.
 Pension solution for government and
personnel pensions.
 Retail lending module for consumer loans,
vehicle loans, and so forth.
 Structured financial messaging system for
online remittance transactions between
PNB branches.
 Real Time Gross Settlement system for
inter-bank remittance operations.

PNB and Natural Technologies are now

working towards consolidating the entire
distributed BancMate data at the head office
for the purpose of generating an enterprise-
wide reporting system.

PNB and Natural Technologies are also

developing a new bilingual BancMate
centralized core banking solution based on
Windows Server 2003 and SQL Server 2005.
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Published in April 2006