Given this business is largely driven by people, it is paramount that there is a definite strategy aligned to the overall business objectives of the firm. The key to success here lies in designing the organization in a lean way and thus moving away from the conventional overtly layered structures found in large banks. Multi-hatting is the norm and specialization is only where necessary. With this mantra, these organizations are likely to see consolidations of many support functions which usually operate as COEs in large setups; leading to enhanced control and alignment to the overall direction. On the revenue front, the structure is expected to be largely two pronged – one responsible for the distribution and the second for tie-ups. With a limited product base, these banks are likely to see a central product vertical that would be responsible for both the regulatory aspect while ensuring marketability.
Treasury, usually typecast as one of the “glamorous” functions in a large conventional bank will be limited to playing a resourcing and money market management role in these new banks. Wholesale banking will also be missed as the target audience on a B2B front is likely to be micro to small enterprises. Payment banks however, would be tapping into the operational accounts of many internet-based service providers as they have the perfect marriage of the need and the solution. They will enable a different experience by bringing both the customer and service provider on the same platform. Given the hiring in the small banks is likely to run in thousands, firms are likely to adopt highly efficient screening mechanisms to manage this large scale talent acquisition. Competency-based algorithms will be the favorites for selectors to get the “right” talent in.