Hyderabad: National Securities and Depositories Limited (NSDL), which has been primarily serving the equity market, has focused on new products and services. It will expand its services to new products like bonds and 'Electronic Gold Receipts' (EGR) as per the current needs, disclosed NSDL MD and CEO Padmaja Chundur in an interview with ETV Bharat.
Q) You are a career banker and heading NSDL. How has the transition happened?
Thanks to the great team at NSDL, the transition has been quite smooth. I think Capital Markets are now going through a phase that banking went through a few years ago with the financial inclusion drive (JAM trinity- Jandhan, Aadhaar, Mobile). As banking became more accessible through digital means, the number of users and volumes increased, especially in payments. Similarly, the investor base in capital markets is expanding at a fast pace, thanks to digital technology, simplified processes and ease of transacting. There are a lot of similarities in the change management process. Having seen the other side, it is very exciting to be at NSDL to experience this now.
Q) While taking over the responsibilities of MD and CEO of NSDL, what kind of challenges and opportunities did you see before NSDL?
The NSDL is the first Depository that was set up in India. NSDL coined the word Demat and has been instrumental in the development of Capital Markets in India. "I am delighted to have become a part of the journey during this Silver Jubilee Year of NSDL. Our motto is Technology, Trust, and Reach and one of our key deliverables is to provide seamless operations and high-quality service. We have to, therefore, renew our focus on operational efficiencies and resilience through process and technology."
The significant growth observed in Demat accounts in the last two years is because of the participation of people from all demographics of the country. As an MII, it becomes our responsibility to focus on investor awareness so that people invest their hard-earned money only based on their risk appetite and in the right products. The NSDL has launched an initiative “Market Ka Ekalavya” for graduating students. This is an online programme delivered in Hindi and other regional languages. On the product side also, as the industry is evolving, we are working on the development of the market for Bonds, rolling out Electronic Gold Receipts as an offering.
Q) What are the key changes you have brought into the organisation?
With the increasing participation from across the country in equity markets, and especially since a big part of this is coming from first-time investors, the millennials, and Gen Z, it is all the more important that they have awareness of the basics of investing and the risk-reward metrics in any investment. It is also important that the knowledge is imparted in simple jargon-free usage, in their native language and in short capsules. With this end in view, we conceptualized the “Market ka Ekalavya”, an online programme in regional languages, aimed at graduate students, which was launched in May this year by the Union Finance Minister Nirmala Sitaraman. This initiative was extended in a capsule form as “MKE-Express” in 75 cities, as part of the 'Azadi Ka Amrut Mahotsav' celebrations.
The pandemic has given a big thrust to automation and digitalization. It is imperative that we redesign our processes to be more agile and client-centric, be innovative and collaborative in identifying and working on new initiatives, improve operational efficiencies and enhance technology. In this direction, we have launched a transformation journey in NSDL named “Program – API” (Aspire, Perspire, Inspire). The objective is to relook at all the functions/processes and work to enhance the client experience.
Q) What are the new products and services NSDL can offer, apart from the existing services? Do you have a plan to introduce these new services?
• Enhancements of NSDL Consolidated Account Statement (CAS) offering and dematerialisation of other asset classes to give investors one view of all their holdings
• Some of the products under development include
o Electronic Gold Receipts (EGR)
o Collateral Management Services (CMS)
• Develop new products for further expanding the Bond market
• Enhancement of Debenture Security and Covenant Monitoring System on the DLT (Blockchain) platform.
• We are also looking at identifying more use cases where DLT as a technology can be used for improvement in Systems and Processes
Q) What steps is NSDL contemplating to increase the country's financial literacy?
• Publish monthly newsletter “The Financial Kaleidoscope”. It is sent to all the investors, who have a Demat account with us.
• NSDL launched an initiative “Market Ka Ekalavya” for graduating students. This is an online programme delivered in Hindi and other regional languages. NSDL also conducts investor awareness programmes across the length and breadth of the country in collaboration with NISM, SEBI and DP.
Q) Is the NSDL IPO on the cards?
We have initiated the preparatory process and will take it up at an opportune time.
Q) How do you see equity investment culture emerging in India, particularly from the retail front?
• The number of Demat accounts has grown exponentially in the last two years from four crore to 10 crore now.
• Number of Demat accounts opened in NSDL during FY 2021-22 increased by 127% YoY. This is through Depository participants operating from more than 57,000 Service Centres.
• These Demat account holders are located in more than 99% of pin codes within the country and 166 countries across the globe, reflecting the wide reach of NSDL’s Depository services.
• This momentum is expected to continue in years to come with investors globally betting on the Indian growth story.
• Such a sharp increase is because of mobility restrictions during the lockdown, shift to work from home set up, ease of account opening, increase in mobile and data penetration and a drop in brokerage rates.
• The participation of all demographic segments, especially millennials will ensure both growth and momentum.
Q) Start-up boom just happening in India? How can this be taken to the next level of growth? Can you share your thoughts about the listing of start-ups on Indian stock exchanges?
• India today has more than 78,000+ DPIIT recognised Startups. We also have more than 100+ Unicorns in the country.
• This decade is certainly for India and Startups are a major contributor
• The government has been consistently focusing on Ease of Doing Business
• I recently attended a Startup event. Interestingly, I found a lot of startups that want to get listed in India. There are currently some improvements we are doing in the processes and will take it forward as an MII (Market Infrastructure Institution).
Q) Striking a balance- How do you successfully manage your responsibilities and professional work simultaneously with great success? What is your secret to glory?
I believe in collaboration and teamwork both at work and at home. All of us need the positivity and support that comes from our family and colleagues to achieve our goals.
Q) What are your memories of your previous assignment as MD and CEO of Indian Bank? How did you handle the merger of Allahabad bank with Indian Bank as there are many challenges apart from cultural differences?
As MD & CEO of Indian Bank, the merger exercise between two banks with very diverse geographic footprints and organisational cultures was a tough task. Moreover, just as we embarked upon the journey, Covid struck and the merger moved on to the digital mode of execution. It is to the credit of the Indian Bank team that it was completed smoothly in time and with minimum disruption to customers. So much so, that this became a case study published by Harvard Business School. I believe the main reasons for a successful merger were meticulous planning, continuous engagement and communication with customers, employees, RBI, Technology partners, government and all stakeholders. The spirit and commitment of the Indian Bank team were incredible.
