Portfolio attrition is a burgeoning issue in the Indian banking market. With RBI pushing for a transparent market by discouraging loan pre-closure penalty and switch fees balance transfer and frequent rate bargaining in the Indian loan market has become commonplace. The aim of the project was to reduce the same.
Due to confidentiality clause, I wouldn't be able to discuss the project in detail, but I'll try to broadly cover most of it:
Creating a customer profile: As a bank, we had an idea of the customer attrition in terms of broad numbers but we didn't know if customers of a particular profile were churning more than the others. I developed a customer profiling model using statistical tools (eg. ANOVA, T-test using SPSS) and achieved two prominent profiles which we focused on.
Data Analysis: With a lot of data on different kinds of attrition and customers involved, I did a thorough seasonality analysis followed by customized product planning to make the customer sticky to the proposition.
Pilot Project 1: As a part of the project I devised a whole new dimension in retention by using sales and reaching the customer at a personal level with customized offers after a series of negotiations.
Pilot project 2: To catch a customer at a nascent stage of dissatisfaction, I implemented a model using CIR enquiries raised in consultation with TransUnion Software Co. The project is expected to impact
Training: Since a lot of changes had been initiated in a short period of time, different teams had to be trained regarding the same. So, with the help of a couple of my team members I designed the training module which was implemented by the bank's training team.
Impact: In a span of two months a direct impact of more than INR 700 Million could be seen as a result of these changes. Also, it is expected to bring down customer churning by another 20% in the coming months.
Presentation: The presentation won applause from top management and I got selected for the CEO Hall of fame (3 out of a batch of 37 interns did). It was an amazing experience as this was the first time in my life that I was presenting to a board, and man that board room was intimidating. They were very receptive of the recommendations and changes and suggested me to get these implemented in other departments too. Getting an iPad and an individual photo with the CEO was the icing in the cake!
Amazing people: None of what I could learn and do would have been possible without the awesome team I had. Every product manager I came across helped me with new insights. Each and every nuance of every little change was discussed in detail before being implemented. The best part was that they made me feel belonged to the place and task. And yes, we had some great team-parties!
Surprise Surprise!: A very important lesson that I learnt during the course of the internship was that the theoretical aspects that are being taught at a B-school (and often ridiculed by students while in the process) can help one establish solid results, form models and develop end-to-end process changes. In a Banking project I could use things taught in marketing research, finance, accountancy, management information systems and even operations.
Akshay Tiwari, a PGDBM student from XLRI, Jamshedpur has a passion for writing and has appeared in editorials of several leading dailies including The Hindu. He blogs at http://akshay-tiwari.blogspot.in/
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