Chennai tech arm’s core product to power StanChart globally

Chennai tech arm’s core product to power StanChart globally
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First Published: Thu, Aug 09 2007. 12 41 AM IST

Software edge: Sreeram Iyer, chief executive of Scope International and chief information officer for Standard Chartered India.
Software edge: Sreeram Iyer, chief executive of Scope International and chief information officer for Standard Chartered India.
Updated: Thu, Aug 09 2007. 12 41 AM IST
Standard Chartered Bank Plc. will soon automate and integrate its operations across 50 countries using a core banking software developed at its Indian software services and back-office unit, Scope International, in Chennai. This will make the product - named eBBS, short for electronic basic banking system - the second such software developed by a global bank’s unit in India.
Flexcube, a product now owned by Oracle Corp., was developed by Citibank NA’s Indian unit Citicorp Information Technology Industries Ltd (now i-flex Solutions Ltd) in the 1990s.
In the past two years, eBBS, which integrates core banking functions such as retail, corporate and wholesale banking, has been rolled out across 20 countries, including StanChart’s operations in Dubai and the United Arab Emirates, and is now
Software edge: Sreeram Iyer, chief executive of Scope International and chief information officer for Standard Chartered India.
being deployed across 81 branches of the bank in India.
“Our Indian operation will fully go live with the product by 2008, replacing Hogan system from CSC (Computer Sciences Corp.),” said Sreeram Iyer, chief executive of Scope and chief information officer for StanChart in India.
StanChart spends around 4% of its revenues on computer hardware and software applications, apart from managing global communication networks. Scope manages about 85% of the bank’s internal IT needs, up from about 60% three years ago.
The British bank had been using banking products such as CSC’s Hogan and Bankmaster from UK-based Misys Plc, “which had become outdated and the bank was seeking a more sophisticated solution”, said Iyer.
StanChart believes its proprietary software is a source of competitive edge over rivals using products from third-party vendors, such as Finacle from India’s second largest software company Infosys Technologies Ltd and Flexcube. Not only is there significant customization in implementing packaged solutions, homegrown products such as eBBS support functions such as customer records and account management across databases.
But a big challenge could be in rolling out the product to 30 more locations, including India, where operations differ in complexity. “Since it is a homegrown application, they must have done their requirement analysis pretty well,” which could mean less roll out pains, said Shirish Pathak, founder of Pune-based Finsight Media, a tracker of banking technology in India.
Technical support for the product will be staffed from Chennai, Iyer said. Scope currently has 5,700 employees who manage back-office work and software development for StanChart’s 60,000-strong workforce across 50 countries. The bank, “will have over 10,000 employees in Scope by 2010”, Iyer said.
Globally, only HSBC Bank Plc. and Standard Chartered have been among large banks using homegrown applications for core banking.
But in 2005, HSBC partnered with banking software vendor Temenos Group AG to co-develop and deploy a version of its core banking software. “The question really is about how long can Standard Chartered hold on to its homegrown application, as software development is not core to its business,” said Finsight’s Pathak.
Will the bank try and sell off its Scope unit on the lines of what Citibank did with the former Citicorp IT Industries? “Not exactly; the bank believes that this is core to their business and there is no possibility of a sell off,” said Iyer.
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First Published: Thu, Aug 09 2007. 12 41 AM IST