Why ICICI Should Be Worried By Kotak’s Evolution As The Most Social Media Savvy Bank In India

Kotak Mahindra Bank has launched Jifi Saver, a savings account that can be manged by Facebook and Twitter, a year after Jifi was launched thereby giving competition to ICICI's Pocket App for Facebook

Kotak Jifi Saver

Indian banks are coming out of the withheld notion that social media is all about running contests on Facebook and trending on Twitter. Most of the forward thinking banks are now integrating social media with their banking services to make the new-age customers life easy. Kotak Mahindra Bank, the fourth largest Indian private sector bank by market capitalization, headquartered in Mumbai is one of them; it has launched a social savings bank account - Jifi Saver, which can be managed via Twitter and Facebook.

According to The Hindu Business Line: Customers can open a Jifi Saver account online, using Facebook or Twitter, receive a Jifi debit card and a free subscription to Kotak MoneyWatch (KMC) platinum plan for the first year to track expenses and plan their finances. It facilitates utility bill payments, offers mobile and DTH recharge via Twitter, reward and transaction points, 25 free at par cheques per quarter and avail unlimited free transactions at Kotak ATMs.

The company also states that, “Jifi Saver will take care of online shopping, on-the-go transactions, financial planning, etc. It also offers all benefits and functionalities of a regular savings bank account.” Available in 27 cities across the country at present, Jifi Saver will enable customers earn savings interest rate offered to all savings account holders, i.e., 6 percent p.a. on balance of above Rs. 1 lakh and 5 percent on balance up to Rs. 1 lakh.

Users can login into the Kotak Jifi website and enroll for Jifi Saver via a Facebook or an email login. Already 28,190 people have connected to Jifi, says the portal. “About 25 percent of our customers are using Twitter to bank with us, while about 50-60 percent bank using Facebook,” said Deepak Sharma, Executive VP, Digital banking. He further added that about 40 percent of Kotak bank customers are using internet and mobile banking. Jifi has helped the bank maintain a stable CASA (current account and savings account) growth with an average balance of about Rs. 30,000.

Jifi - Evolution of #Hashtagbanking on Twitter

Last year during the month of March, Kotak along with IBS, the digital agency based out in Mumbai had launched Jifi – a first-of-its-kind fully integrated social bank account designed for the tech-savvy socially connected generation of today. Jifi, a non-interest bearing account integrates social media platforms like Twitter and Facebook with mainstream banking for secure and seamless on-the-go information.

Jifi allows creation of your account by signing up via Facebook or email to get an invite. Account updates can be received on Twitter as a Direct Message (DM) by simply tweeting to the Twitter handle @KotakJifi with predefined hashtags. The bank’s dedicated Twitter handle @kotaksync will send out these messages, thereby eliminating human intervention and maintaining confidentiality.

“While we removed all physical intervention for our target audience, the only physical interaction happened due to the RBI regulation,” shared Karthi Marshan, Executive Vice President & Head Group Marketing at Kotak Mahindra Bank in an earlier interaction with Lighthouse Insights.

Even though Jifi has tasted its first success, during the interaction Karthi was quick to point out that Jifi may not be perfect but it is a first attempt from the bank trying to do something new for this financial segment audience. “It is nascent yet but it will probably mushroom and balloon before we know it much like Whatsapp and Facebook. So we want to be ready for it.”

KayPay - Payments via Facebook

Along with Jifi, Kotak had launched KayPay last year. KayPay is a bank agnostic payment product for Facebook users to send money to each other. According to the company, “Users won’t have to depend on net banking or have to know the details of the payee. Users can transfer funds by choosing recipients from their Facebook friends list.”

KayPay is built on top of the mobile based Immediate Payment System launched by the National Payment Corporation of India. Users have to register their bank accounts once to start using the service.

Threat to Pockets by ICICI Bank?

ICICI Bank, India’s second largest bank has been one of those banks which started slow on social media but over the time it moved ahead in offering value added services to fans on the medium itself. It was one of the first banks to spread the idea of banking via Facebook in India with its Pockets app.

Launched in late 2013, ‘Pockets by ICICI Bank’ assured a safe, simple and social way of banking, while you are Facebook-ing. In addition, it also offers features like recharging your prepaid mobile phone or booking movie tickets for your whole gang. All you have to do is register on the Facebook app with your debit card number and PIN.

In an earlier conversation with  Sujit Ganguli, Senior General Manager, Head Brand and Corporate Communications, ICICI Bank had informed that to get started with Pockets, one has to register on the Facebook app with their debit card number and PIN. Designed as a complete website, the informative app has many social features including the ability to make transactions.

But after Pockets, ICICI hasn’t done much in the space but focused on building a fleet of mobile apps. With Kotak’s Jifi, Jifi Saver and KayPay out in the market, Kotak has integrated its banking features with social networks like Facebook and Twitter. In short ICICI Bank will have to do some brainstorming, unless the bank is coming up with banking via messaging apps like we are already seeing in China with WeChat.

Interestingly, Kotak with its hashtag banking is not just targeting the millennials but a much broader base. Like Subhash Vakil, sixty-year-old retired industrialist and one of the high point earners at one point of time.”While we were thinking that social and digital is about the young, it turned out that you don’t need to be physically young, you just have to be an open mind. Today our thought process has evolved and doesn’t necessarily have an age filter; it now has a mindset filter to it,” said Karthi.

Deepak also adds that about 10 percent of Kotak’s accounts are opened online which increased from 6-7 percent from last year. A clear indication that Jifi is getting eyeballs and able to convert leads from digital.

With an expected positive profit up by 29% Q3FY14, Kotak Mahindra Bank has also raised the bar of social banking in the country.