DEPARTMENT OF COMMERCE AND MANAGEMENT STUDIES

UNIVERSITY OF CALICUT

REPORT ON CASE STUDY IN FEDERAL BANK, RAMANATTUKARA

Submitted to, Dr. P. Mohan Faculty, DCMS submitted by, Harikumar c Vishad k Sareesh k Submitted on: 29-feb.2012

ACKNOWLEDGEMENT

We would like to keep on record our heart full thanks to our HOD, Prof.M.A.Joseph, DCMS Calicut University. We express our special thanks to Dr.P.Mohan, lecturer in Management Information System, for his encouragement, able guidance and kind co-operation projected at various stages of this work. The case with which the firm visit could be conducted was wholly due to the whole co-operative assistance of Senior Manager, Federal bank- Ramanattukara, and staff members of the entire division of the concern, for their valuable suggestions and ideas.

CONTENT
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TOPIC ABSTRACT INTRODUCTION ABOUT THE FIRM LITERATURE REVIEW CASE ANALYSIS AND DISCUSSION FINDINGS CONCLUSION REFERENCES

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ABSTRACT
In today s world, which is highly competitive, having the proper installed management information system is a basic reason for the survival and growth of banking companies in general. In fact it is the era of the information explodation. All banking deals with the well maintained MIS to track the customers from time to time. Proper planning and installation of MIS in a bank, is a must. We visited FEDERAL BANK, RAMANATUKARA on 24th February, 2012 to study the MIS installed in the bank. The study helped a lot to understand what sort of impact can be made by the proper MIS to the bank. The objective of the study is to understand the way in which the bank is conducting its events with the help of its well established MIS. Federal bank is using MIS in a well arranged manner and gaining maximum advantage through the system.

Introduction
The globalisation of business, widespread technological innovations, social and political changes and an increased awareness in customers are some of the factor that has forced the business world to undergo rapid changes. A growing need for guidance on concept, issues and strategies for understanding, developing and managing information system in organisation is being felt over the world. This is because of the fact that information is vital and necessary input in decision making. It goes without saying that all managerial functions are performed through decision making; for taking rational decisions, timely and reliable information is essential and is procured through a logical and well structured method of information collecting, processing and disseminating to decision makers. Such a method in the field of management is widely known as management information system (MIS) In today s world of ever increasing complexities of business as well as management, every business organisation, in order to survive and grow, must have a properly planned, analysed designed and maintained MIS so that it provides timely , reliable and useful information to enable the management to take speedy and rational decision. Here we, HARI KUMAR C, SAREESH K AND VISHAD focusing on the MIS of the Ramanatukara Branch of Federal bank in the coming pages.

About The Firm

Federal Bank- An Overview

Public NSC:FEDERAL BANK BSC:500469 LSC:FEDS Industry Banking And Allied Industries Branch name Ramanattukara Type Traded As Address Founded Ramanattukara, Kozhikode, Kerala Kochi 1945

Headquarters Federal Towers, Aluva, Kochi 683 101 Kerala, India

Key People Products Website

Shyam Srinivasan(CEO) Loans, Savings, Etc...... www.federalbank.co.in

BANK PROFILE
Federal Bank is a fast growing premier private sector bank in India with business exceeding INR 3,600 million and INR 61.3 million. As of December 31, 2011, it has 832 branches spread across 24 states in India and 803 ATMs around the country (across 108 metro centres, 224 urban centres, 384 semi-urban locations and 87 rural areas). The bank is planning to expand its branch network to 1000 by march 2012.Technology has played a major part in the bank s aim to differentiate itself to its customers. ATMs, Internet, mobile banking and other channels have broken the barriers of location and time, and have expanded the reach of the bank s operations, earlier confined to the branches.

Background of federal bank

the federal bank limited, previously known as, the Travancore federal bank limited in its entire span of customer services has been both ups and downs. The bank started with an auction-chitty business along with other banking transactions related to agriculture and industry. In the year 1945 a new board of directors was constituted and opened a branch in Aluva. A massive expansion plan was introduced in the years 1975 and1976by opening 53 and 42branches respectively.

Across the globe, banks focus on IT investment protection, best use of available resources and reuse of developed components. Even though the objectives appear to be simple, putting these into practice has been a tough task and very few organizations have accomplished these objectives on a scale that is comparable with the global standards and demonstrated perceivable benefits. Federal Bank is one of the very few organizations that have accomplished these objectives.

LITERATURE REVIEW
What is MIS?
A management information system (MIS) provides information which is needed to manage organizations efficiently and effectively. Management information systems involve three primary resources: people, technology, and information or decision making. Management information systems are distinct from other information systems in that they are used to analyze operational activities in the organization. The successful MIS supports a business's long range plans, providing reports based upon performance analysis in areas critical to those plans, with feedback loops that allow for titivation of every aspect of the enterprise, including recruitment and training regimens. MIS not only indicate how things are going, but why and where performance is failing to meet the plan. These reports include nearreal-time performance of cost centers and projects with detail sufficient for individual accountability.

Types of MIS
Most management information systems specialize in particular commercial and industrial sectors, aspects of the enterprise, or management substructure. y Management Information Systems (MIS), per se, produce fixed, regularly scheduled reports based on data extracted and summarized from the firm s underlying transaction processing system to middle and operational level managers to identify and inform structured and semi-structured decision problems. y Decision Support System (DSS) are computer program applications used by middle management to compile information from a wide range of sources to support problem solving and decision making. y Executive Information System (EIS) is a reporting tool that provides quick access to summarized reports coming from all company levels and departments such as accounting, human resources and operations. y Marketing Information System are MIS designed specifically for managing the marketing aspects of the business. y Office automation System (OAS) support communication and productivity in the enterprise by automating work flow and eliminating bottlenecks. OAS may be implemented at any and all levels of management. y School Management Information System (MIS) cover school administration, often including teaching and learning materials

THE MIS STRUCTURE OF FEDERAL BANK

HEAD OFFICE MANAGER

ZONAL OFFICE

INTRANETWORK

DRISYA MEDIA

MANAGER

REGIONAL OFFICE MANAGER

BRANCH OFFICE SENIOR MANAGER

ASSISTANT MANAGER

ASSISTANT MANAGER

PROBATIONARY OFFICER

CLERCK

CLERCK

CLERCK

CASE ANALYSIS AND DISCUSSIONS

Federal bank has the great potential to become the best service provider in its area of operation. Its management information system includes the introduction of the software named finacle and the intranet, drishya media they are using.

Why MIS in Federal Bank?

One of the main challenges on the way to growth for Federal Bank's management team was to choose between a packaged cores banking solution or to continue leveraging its proprietary system. The bank envisaged aggressive plans for growth both organic and inorganic, and the team ultimately felt that the existing proprietary system was not capable of meeting requirements due to its rigidity. The commitment to goals and an organization-wide attitude to welcome the change were most important for the final decision in this regard. As per the management at Federal Bank, to move to a new generation core banking solution, it was essential that:  The new solutions was capable of accommodating and building upon existing products that the bank offers and also help bank release futuristic products.  The new solution significantly improves the customer's banking experience  The system is capable of interfacing with various delivery channels like ATM, Internet banking and so on  The new solution helps the bank comply with regulatory requirements. The next step was the selection of the packaged solution.  Federal Bank framed a well-defined and clear-cut plan for selection of appropriate system identifying the strength and weakness of the recourses and infrastructure available  A strong pool of experts was identified to lead the mission  A thorough selection process was initiated which resulted in three shortlisted solutions  Vertical and horizontal evaluation process was performed by experts taking inputs from all possible sources  The bank's team mapped the capabilities of each system against the business requirements and Finacle from Infosys was selected by the bank.

What is Finacle?
FINACLE universal banking products are designed to address the core banking, e-banking, Islamic banking, and treasury, wealth management and CRM requirements of retail, corporate and universal banks. It is developed by Infosys and is one of the major players in the arena of core banking in Indian and Asian banking domains.

Services
Providing support & services is typical in such huge software implementations. Services provided by Infosys for the maintenance of the application include. y y y y y y y y Application development and maintenance Application management Independent validation Migration services Performance tuning Software performance engineering System integration Value mining

Integration into Pricing Engines typically used in Banks, with partners such as Suntec.

FINACLE The solution

Federal Bank decided to adopt a centralized architecture for better efficiency, more control and for meeting challenges of the future. After a rigorous selection process, Federal Bank decided to adopt innovative technology by procuring Finacle universal banking solution from Infosys to fuel its retail core banking transformation initiative. The solution was fully equipped to accommodate and build upon existing products that the bank offered to its retail customers and empower the business to

introduce futuristic products as well. It promised to significantly improve the customer's banking experience and support it through various delivery channels like the Internet etc. A significant reduction in time-to-compliance was another key solution differentiator. The replacement exercise began with rigorous testing of the Finacle solution using a large number of test cases, representing various types of retail transactions typical of Federal Bank's operational scenario. The setting up of the data centre and disaster recovery site in accordance with international standards, in different seismic zones, was also planned and executed. Federal bank started an aggressive roll out of the system in the last week of April 2007. Once the full-fledged implementation started, the bank surmounted the change management challenges in human capital. The most important factor was getting the staff to unlearn whatever they had learnt and the staff had to be motivated to assimilate the benefits of migrating to a new environment, explore more of the new solution and draw more from it. Federal bank is an end-to-end solution provider for customers in a distributed system through various channels such as ATM, telebanking, mobile alerts, e-mail alerts, and electronic bill payments, RTGS, NEFT and its flagship offering anywhere banking. Federal Bank identified 36 channels, which enabled the bank to run a centralized system even though it was running on a distributed system; seamless integration of these entire channels was a major focus during CBS implementation. The solution is designed with Oracle RDBMS back-end; open architecture is developed and tuned on HP, Sun & IBM UNIX platforms. Finacle solution came ready with almost all channel services. A major business challenge was the seamless integration of these channels providing customers with un-interrupted service even during the transition period. The technical team identified Finacle channel integrator Connect 24 as the starting point for channel integration. Most of the Fed Soft legacy system was integrated with Financial Messaging Service (FMS) and an interface was internally developed for communicating between Fed soft and Finacle. Every channel was integrated thought this interface.

Some Federal Bank channel features integrated are listed below;

 FedNet (Finacle e-Banking) A customer who wishes to access his/her accounts through Internet has to register by submitting the FedNet application downloaded it at the branch where he/she is having the account. If the account is maintained by more than one person (irrespective of the various modes of operations like, Joint / Either or Survivor etc), mandate in favor of the user (operator) in the specified form also should be submitted along with the application. There are separate mandate forms download it for individual accounts and Partnership/Trust/Company etc accounts. Mandate form should be signed by all the account holders/signatories. In case accounts in more than one branch are to be linked, customer can submit the FedNet application to any one of these  E-mail alerts Now the customer can receive their account details in their mailbox. All they need is an email address for receiving the alerts. Following are the areas covered under e-mail alerts y Statement of accounts: the customer have the option to request Daily, / Weekly / Monthly statement of accounts and can receive statement by email provided there was transactions in that account during the period selected. y Intimation of cheque book issue: the customer will receive e-mail intimation of cheque issue in the registered account on the same day. y Deposit due date intimation: the customer will receive the due date intimation mail 10 days prior to the actual due date. y Deposit renewal details: the customer will receive the details of the new account by email on the same day of the renewal. y Standing instruction expiry: The customer will receive the intimation mail 10 days before the standing instruction is due for expiry.

 FedFast Fed Fast is the state-of-the-art remittance platform through which NRIs can make Rupee remittance from Gulf countries to the beneficiary s account in India. Once the remitter remits money at the Bank / Exchange house in the Gulf, the amount is credited to the beneficiary s account with Federal Bank or any other Bank within a short span of time. Why Fed Fast? Fed Fast is not restricted to the Federal Bank customers alone. NRIs can also remit funds through Fed Fast to accounts with any banks in India. Federal bank have the largest number correspondent arrangements from GCC and this gives more choices for our customers to transfers funds. Federal Bank have tieups with 52 Exchange Houses and 5 Banks in the Middle East for making remittance.  Mobile banking This is a facility that enables customers to access banking facility through mobile. Mobile Banking enable customers to make inquiries and do transactions (like fund transfer, cheque book request etc.) through their mobile phones Eligibility All SB and current account holders with mode of operation as Single/ Sole proprietorship, either or survivor or anyone or survivor can be registered for FedMobile facility. Joint accounts and accounts in which minors are involved are not eligible for FedMobile registration Services Offered y PULL based services (initiated by the customer) y PUSH based services (originated by the Bank) y Request services (initiated by the customer for placing various requests/instructions to Bank) (The customer can avail Mobile Banking on any Mobile Phone with valid connection from a service provider. However for enjoying all the services offered through Mobile Banking, a handset with added features is essential.)

Technology in Use y SMS: It works on the "Text Messaging Facility"also called the SMS that is available on mobile phones. This facility allows you to send a short text messages to 5676762 or +919895088888 from your mobile phone instead of making a phone call. The response is sent to you as an SMS message, all in the matter of few seconds. y GPRS: General Packet Radio Service (GPRS) is a packet oriented mobile data service through which you can access the services of Federal Bank Mobile Banking using your MPIN. GPRS will be enabled by the mobile service provider. y J2ME: Using GPRS Internet Connection, You can download the Mobile Banking application on your mobile handset from our Bank's website https://mobile.federalbank.co.in/j2me  FedEpay  Cash management system (CMS).  RTGS FedFlash  Anywhere banking

FINDINGS
In the fast changing environment of the Indian banking space, the speed and efficiency of banking services through effective use of technology will be essential for banks to attract and retain profitable customers. Federal Bank believes that technology enables banks to have better centralized control systems. Finacle core banking solution has positively impacted Federal Bank s customers and staff. Some of the key benefits are highlighted below:  CBS pilot implementation target of 16 branches by March 2007 was achieved in February 2007, well ahead of schedule  Phase by phase CBS migration was successful. Currently all branches have been migrated and are running on Finacle. Entire bank s migration was achieved in a record speed of less than a year  Bank has been able to translate a substantial number of general customers to regular and frequent customers  Federal Bank conducted a customer survey and around 60% of customer have noticed a marked improvement in the usefulness and convenience of the features of the new banking system  Improved 24/7 availability - 99% uptime  Apart from acting as a tool for customer accretion, features and functionalities in Finacle helped to generate revenues by reducing transaction cost, increased speed and reduction of dependencies and thereby providing comfort to the customers in the arena of banking transactions and allied services  Disaster Recovery Setup (DR) became operational offering all the facilities according to international standards (Level 3+). DC/DP switching was performed smoothly without any branch activity being affected  Realignment of business processes with industry best practices which was achieved by adopting Finacle; this also resulted in reduced support & maintenance costs  Consolidated MIS is now available as per requirements on a daily basis. Consolidation was earlier done monthly and trade finance business reports excluded from consolidation  Highly parameterized product definition functionality permitting bank to introduce products in minimum time

 The bank has already launched:  Complete straight through cash management system which handles entire clearing and collection requirements of branch (Complete web-based J2EE solution developed in house)  Online account opening and loan processing. (Complete web based (J2EE) solution developed in house )  Products in pipe line expected to be launched soon  Savings account (4 Categories) current account (4 Categories)  Online share trading  Straight Through Processing of foreign remittance  Mobile commerce  The bank expects to increase the number of customers to 4.6 million with the help of technology in the next 12 months without increasing any staff resources  Centralized bank functions - The performance of the bank will improve in all spheres of activities; some of the advantages the bank have been able to reap by implementing a centralized solution like Finacle are:  Reduced time to launch and time to market for various products - the availability of the product is simultaneous at all its branches  Also interest rate changes, daily exchange rates etc. can be centrally administered. Branches will act as service outlets and cater to the needs of the customers  Most back office jobs like account opening, issue of cheque books, customer letters, clearing etc are centralized at a Central Processing Centre. Once field level functionaries are relieved from such drudgeries, they can concentrate on business development, resource mobilization, recovery etc.  MIS is available centrally. Hitherto the administrative offices sought various reports from the branches. With the data residing at a central point, any report can be generated centrally  With data hosted centrally, various sophisticated software for data warehousing and data mining can help the bank in implementing a decision support system to aid the bank in arriving at decisions in Asset Liability Management or monitoring compliance with regulatory requirements  With CRM module in place, it is easy to segment customers and products can be designed to suit each segment of clients

 All channels like AWB, FedFast , FedNet Bill Pay online bill realization, Mobile Alert, and Email Alert were successfully integrated with Finacle enabling the bank to continue to offer the unique services available in FedSoft. Even during the transition period, entire channel service was offered to customers without any interruption  Transition period did not pose any hurdles to the expansion strategies of Federal Bank including ATM expansion to 447 numbers. During migration period nearly 100 new ATM s were opened  New wing Central Processing Centre (CPC) has been set up and is fully functional. Nearly 25000 loan and 38000- account opening and modifications were processed through the system during this short span  Development of complete MIS system was based on Finacle data.

CONCLUSION
The technology has opened up new markets, new products, and new services and efficient delivery channels for the banking industry. Online electronics banking, mobile banking and internet banking are just a few examples. Information technology has been the cornerstone of recent financial sector reforms aimed at increasing the speed and reliability of financial operations and of initiatives to strengthen the banking sector. MIS provides vital information at the right amount, in the right time. It has set the stage for unprecedented increase in financial activity across the globe. MIS makes the tremendous changes in banking sector. Banks provides lot of services to its customers with the help of the MIS. It enhances speed, reliability, global access and reduce burden of paper. By using Finacle core banking solution reduce man power in banking and effectively addresses their strategic and needed flexibility to adapt to dynamic environment.

REFERENCE
1. Management information system- Gordon B Davis & Margrethe H Olson. 2. www.federalbank.co.in

3. Booklets and broachers of the federal bank.