City Union Bank: A Century of Innovation and Customer-Centric Banking

November 29, 2023 02:57 pm | Updated 02:57 pm IST

Present-day City Union Bank was originally established as ‘The Kumbakonam Bank Limited,’ a limited company, on October 31, 1904, by twenty devoted citizens of Kumbakonam. In its early years, the bank took on the role of a regional bank and gradually established itself in the Delta District Thanjavur.

In 1957, the bank acquired the assets and liabilities of the Commonwealth Bank Limited. In April 1965, two local banks, namely ‘The City Forward Bank Limited’ and ‘The Union Bank Limited,’ were amalgamated, leading to the bank’s renaming as ‘The Kumbakonam City Union Bank Limited.’

In November 1980, Shri. V. Narayanan, then Secretary, assumed the role of Chairman and Chief Executive Officer, marking a glorious chapter in the bank’s history.

The first branch outside Tamil Nadu opened in Sultanpet, Bangalore, Karnataka, in September 1980. Subsequently, branches were established in many other states. Aligning with its national image, the bank’s name was changed to ‘City Union Bank Limited’ in December 1987.

The bank introduced computerization in 1990, with all branches becoming computerized. Automated Teller Machines (ATMs) were installed at select centres, allowing cardholders to withdraw cash, make balance inquiries, and obtain statements.

The bank acquired a license from the Insurance Regulatory Authority of India (IRDA) to serve as a Corporate Agent, selling insurance products and providing value-added services to the public. The bank offers Life, General, and Health Insurance products through partners like Life Insurance Corporation of India, Tata AIA Life Insurance Co., and Bajaj Allianz Life Insurance for Life Insurance. For General Insurance, it collaborates with Shriram General Insurance Co Ltd and Royal Sundaram General Insurance Co, and for Health Insurance, it partners with Star Health & Allied Insurance, Care Health Insurance, and Aditya Birla Health Insurance.

Additionally, the bank provides Demat services to its customers.

In 2004, the bank celebrated its Centenary, holding festivities on December 27, 2003, at the Saraswathi Patasala Girl’s Higher Secondary School Grounds, Kumbakonam. The event was chaired by Shri. V. Narayanan, with distinguished guests including Shri. R. Venkataraman (Former President of India), Dr. A.R. Lakshmanan (Judge, Supreme Court, New Delhi), and Shri. N. Rengachari (Retired Chairman, IRDA & Advisor to the Government of Andhra Pradesh).

In the rich history of City Union Bank Limited, a significant portion of its journey, almost one-third, revolved around a key figure—Shri. V. Narayanan. His remarkable leadership style, unwavering vision for the bank’s consistent growth across all fronts, tireless efforts in expanding the branch network, fostering harmonious industrial relations, and the unique achievement of not losing a single man-day to labour unrest, a notable record in the country, brought both personal acclaim and elevated the bank’s standing in the entire Indian Banking Industry. His famous mantra, ‘Take care of the bank; The bank will take care of you,’ worked wonders, enhancing morale and improving workforce productivity. Sadly, the bank lost its illustrious Chairman, Shri. V. Narayanan, in an unexpected car accident near Chennai on November 5, 2004.

In 2009, Dr. N. Kamakodi, a professional with a B.Tech., MBA, PhD, and CAIIB, joined the bank as Deputy General Manager in June 2003. He progressed to General Manager in March 2005, became Executive Director in October 2006, and assumed the role of Executive President in January 2011. Eventually, he was appointed as the Managing Director and chief Executive Officer from May 1, 2011.

As of today, CUB boasts 757 branches and 1655 ATMs spread across pan India. The bank has consistently earned net profits and paid dividends to shareholders every year since its inception. As of September 30, 2023, the bank’s total deposits stood at Rs 49878 Cr, with advances reaching Rs 42702 Cr. Notably, 42 per cent of the bank’s advances are dedicated to the MSME sector.

Dr. N. Kamakodi’s visionary drive and persistent efforts to increase transactions through alternate channels have significantly raised the percentage of alternate channel transactions from 25 per cent to 96 per cent today. This has created an ecosystem that positions CUB as a fantastic avenue for easy banking.

Under the guidance of Dr. N. Kamakodi, the bank implemented a robust IT infrastructure, deploying ATMs, Bulk Note acceptors with recycling facilities, Self-Service passbook kiosks, Self-Service Cheque acceptor kiosks, Multifunction kiosks, and more on a large scale. New online applications such as Internet Banking, Mobile Banking, and Mobile wallets were launched, offering various value-added services. The bank has been actively promoting QR Codes, PoS devices, and Credit cards to customers.

The shift of transactions to alternate channels benefits both the bank and customers. Customers can now conduct transactions from anywhere and anytime, making geography a thing of the past. This not only saves their time and energy but also allows the bank to optimize staff and enhance customer convenience.

CUB has been at the forefront of technology, pioneering numerous IT implementations. Computerization began in 1990 with the deployment of Branch automation software, CUB Soft. The first CBS application was implemented in 2004.

Various banking technologies evolved at CUB over the years:

- Networked ATM operations and Net Banking commenced in 2005.

- Internet Banking was introduced in 2008.

- Mobile banking was deployed in 2010.

- Point of Sales machines were rolled out in 2011.

- Express Desk was introduced in 2012 at branches.

- Multi-functional Kiosks were introduced in 2013.

- Cash Acceptor Machines (BNAs) were implemented in 2014.

- Self-Service Pass Book Kiosks and Cheque Deposit machines were deployed in 2015.

- Credit cards were introduced in 2016.

- Mobile wallets were launched in 2017.

CUB has been a pioneer in various technological implementations. Some noteworthy examples include:

- Implementation of ROBOT ‘CUB Lakshmi,’ the first in the Indian Banking Industry to serve customers.

- Introduction of the first multi-lingual Chatbot as part of the Mobile Banking app.

- Early adoption of Video KYC to seamlessly complete the customer on boarding.

- Early adoption of Wearable debit cards in the form of Key Chains and W ristwatches, providing convenience for payments at PoS terminals using Near Field Communication.

- Launching UPI123Pay, the UPI application aimed at rural penetration of digital payments for basic phone users as part of a Financial Inclusion initiative.

- Introduction of Cardless Cash Withdrawal (ICCW) for withdrawing cash from ATMs without a card, utilizing QR codes.

- Pioneering Voice Biometric Authentication for Mobile Banking, offering an additional layer of authentication. This initiative is part of the 5G Innovation.

Continuous technological innovation is driven by our commitment to meeting customer desires and providing the best service possible, aiming to minimize branch visits and enable banking from the comfort of homes or any location. Many do it yourself channels has been introduced and currently the digital penetration among our customers stands at approximately 96%.

For all banking transactions, customers no longer need to visit branches, except for those requiring physical presence, such as Locker operations and pledging jewels for Jewel Loans. Account opening is facilitated online through Mobile banking and the Video KYC verification process.

CUB has implemented an end-to-end digital loan application and sanctioning process for Retail and MSME loans. This digital process retrieves documents from borrowers, interacts with other agencies for GST, demographic, and income tax details, and determines the loan amount with scoring for applicants, simplifying the credit sanctioning process for authorities. Customers experience swift sanction and disbursement with the least Turn Around Time (TAT).

Extensive use of Artificial Intelligence (AI), Machine Learning (ML), and Robotic Process Automation (RPA) underscores CUB’s commitment to advanced technology.

CUB employs predictive analytics using AI/ML for various business cases.

Several significant use cases handled by RPA in CUB, previously managed manually covering both internal and various customer-centric processes.

RPA is extensively used to enhance process efficiency, meet dynamic customer demands, and streamline process automation.

CUB proudly introduced IVR based payment product UPI123 for feature phones through which customers will be making payments through a step by step manual process. As part of next innovation, they have launched “HELLO UPI” Conversational Payment through UPI 123 in Regional Languages. Customers can now make conversational payments through their Smart Phone or Feature Phone in their own language using voice. This will benefit majority of customers who prefer conversing in their own language and also benefit Senior Citizens and visually impaired to make payments.

CUB has implemented Interoperable Cardless Cash Withdrawal (ICCW) from ATM using UPI in all NCR branded ATMs (around 800 ATMs). This feature will enable the account holders to withdraw cash without using ATM cards. UPI QR code will be used to authenticate the transaction. CUB is also in the process of enabling this facility in other ATM brands also. With this the entire CUB ATMs will be capable of dispensing cash using UPI. CUB was the FIRST Bank to launch this facility in the year 2019.

Another conversational payment feature was launched by CUB using IoT technology for making conversational payment using Alexa. This pilot launch will facilitate customers to make payments, account balance enquiry by conversing with Alexa. Customers can use this facility by simply registering once with Alexa. IoT based technology are making the current trend and CUB customers will be excited to use this facility.

Currently Customers can register for UPI service by using their ATM card. In order to facilitate customers who do not have ATM card and to make them utilize UPI payment, CUB has launched registering for UPI through their Aadhaar. This will penetrate more UPI usage by customers who were deprived due to not having ATM card. Customers need to follow simple steps to register themselves using their Aadhaar credentials and start making payments using UPI.

In conclusion, any IT-based service in banking is available at CUB.

“This article is part of sponsored content programme.”

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