Microfinance Institutions Need To Improve Data Privacy And Cyber Security, Says SBI MD

The executive called for financial institutions to work towards making transactions more efficient through digital means to meet the evolving needs of the customers with the changing times.

Microfinance institutions (MFIs) need to focus on data privacy and cyber security to help them as they cater to a large number of customers, the State Bank of India (SBI) managing director, Alok Kumar Choudhary, said on Wednesday. 

Addressing a conference organised by Sa-Dhan, the bank executive urged MFIs to shift focus to capacity building to manage the challenges going ahead, reported PTI. “The second thing which is very important is the integration with the evolving regulation particularly when you have data privacy law. The enormous amount of data which has been handled by all the MFIs, this particular aspect (data privacy) requires attention and some kind of action plan needs to be in place,” Choudhary stated. 

The executive further called for the financial institutions to work towards making transactions more efficient through digital means to meet the evolving needs of the customers with the changing times. “For this segment of (bottom of the pyramid) customers, we need to understand what they want and ease with which their desire can be fulfilled,” he said. 

Elaborating on SBI’s involvement in the government’s financial inclusion drive, Choudhary noted, “The bank alone has opened 36 per cent of the total account opened under PM Jan Dhan Yojana. More than 50 crore bank accounts have been opened under the PM Jan Dhan Yojana in the last nine years and the deposit balance swelled to over Rs 2.03 lakh crore.”

Talking about the bank’s achievements in Atal Pension Yojana, the bank official said that SBI accounted for 32 per cent of the total enrollment under the scheme. Further, SIDBI chairman and managing director, S Ramann, added that MFIs need to ensure they aren't complacent about their customers as ‘there is so much digital disruption happening around’ with new players entering the digital financial space.