S Ganesh, Chief Executive Officer, D&B Analytics and Decision Services Limited. An industry veteran with 20 years of experience spanning Banking and IT across the globe, he brings in depth knowledge of Credit & Risk Management to the company. This wide experience spans the creation and implementation of multiple platforms & analytic models that are widely used globally. His prior experiences in large global banks like Citibank and SocieteGenerale has given him wide exposure to global best practices. He was also part of the core team that createdSaksoft ,an experience that has taught him flexibility and entrepreneurship . He is an Electronics Engineer with a management degree from Indian Institute of Management, Ahmedabad.
D&B Analytics and Decision Services Limited, Based in Chennai, India, D&B Analytics and Decision Services Limited is a global center of excellence to provide analytics and technology services to its parent organisations and their clients globally. We specialize in delivering Information Management solutions, Analytical models and cutting edge IT services to convert raw data into valuable insights. The users of our solutions and services encompass banks, financial services organizations, credit bureaus, rating agencies and millions of small businesses across the globe. Our people comprising of high caliber analytics professionals, IT engineers and industry experts from some of the finest institutions in the countrystrive to build strong and robust economies around the world by facilitating better credit management and risk management. Dun & Bradstreet (NYSE:DNB) is the world's leading source of commercial information and insight on businesses for 170 years, containing more than 200 million business records.
Replying to Anil Mascarenhas of IIFL, S Ganesh says, “We convert raw data and information into insights and actionable intelligence. Currently there are some opportunities emerging in verticals like telecom, healthcare, and retail as these industries are also very data intensive and use similar principles to expand their customer base and profitability.”
How has the company evolved over the years? Earlier it was more of a captive unit to Dun & Bradstreet (D&B). How much does D&B contribute to your business at present?
D&B Analytics and Decision Services Limited was established as a global center of excellence to develop cutting edge analytics and decision management solutions and provide technology services to D&B and its clients globally. Over last 5 years, we have built sophisticated analytical models and decision platforms to predict customer behaviour particularly in credit risk area to help our clients take credit decisions based on scientific evidence for greater consistency and accuracy. A year back, we also started offering our expertise to banks and financial services organisations in emerging markets of West Asia and Africa to help them manage their risks better. Today our parent organisation D&B contributes around 85% of our revenues, while 15% of our business is from this new segment.
Brief us on your business model. What are the services you provide?
Our business model and our service offerings are focused on our core competencies of building analytical models, decision platforms and Business Intelligence. We convert raw data and information into insights and actionable intelligence. This is a key driver that helps Banks and FIs launch new products and differentiate their existing products to improve their business performance.
Give us a revenue break-up from your different businesses.
Currently, 15% of our revenues are from independent business, a majority of which is through our analytical models and decision management solutions for credit risk management. We are also engaging with some of our customers in the area of business intelligence and risk management areas.
Which are the verticals you cater to and what are the promising ones? Any new verticals you plan to service?
We primarily focus on Banking & Financial Services industry as the impact of our solutions and platforms are most suitable and tailor made for this industry. Currently there are some opportunities emerging in verticals like telecom, healthcare, and retail as these industries are also very data intensive and use similar principles to expand their customer base and profitability.
To what extent has the impact of computing revolutionised the financial service industry?
The massive increase in computing power, cheap cost of data storage and mobility has been and will be the main driver of expansion of banking services and credit. The same will also ensure that there is going to be an explosion in the potential banking universe especially in chronically under banked countries in the African continent , South Asia and Eastern Europe. Technology drastically reduces transaction costs associated with Banking like money transfer, payment processing and monetary reconciliation. The explosion in computing as well as the democratisation of hand held devices also ensures that the potential universe for consumer credits is increasing dramatically. This availability of payment behaviour as well as contactability ensures sufficient data is available on a far larger population, leading to banks and (or) FIs having a credit profile to lend upon.
It is this Technology inflexion that will enable banks and financial services organisations to offer mass customization of its products and services which customers in the developing world truly need.
What are the upcoming trends here? You see social media inputs turning significant? To what extent can they influence lending decisions?
Today we are seeing a number of trends impacting Banking and Financial Institutions across the globe. The primary trend is an increase in interest in consumer and SME Banking away from the trends in the 2000’s of corporate and Investment Banking. The other major trend is the heightened interest of FI’s in under banked economies in Africa & Asia. The third budding trend is the increased use of mobility associated with Cloud and Analytics as the delivery mechanism for the focus areas resulting from the other trends.
Social Media is becoming important primarily from marketing & product management point of view. It is not yet having significant influence on lending decisions because of lack of reliability and inherent negative bias. We are researching on how our risk models can incorporate the social media inputs in predicting credit behaviour of business entities by mitigating such biases.
You have also tapped clients in Africa and West Asia. Tell us more about them. How many employees do you have?
Africa and West Asia is a very important market for us. We work with several regional banks, Islamic Banks as well as few global banks in the region. These banks have leapfrogged few generations by deploying latest technology platforms and are now looking at how analytics and business intelligence can help them catch up with more established multinational banks.
We currently have 350 employees across our India and overseas offices.
Who would you describe as your competitors?
Our competitors include global analytical services providers such as FICO & Moody’s and IT services companies like IBM & Accenture. We also see some smaller players operating in some of the countries.
What edge do you have against them?
Our biggest edge is our ability to blend our global expertise with local experience. D&B has a long history of providing business insights based on its sophisticated analytical models and vast amount of business information available with it. In last one decade, we have also acquired significant experience in emerging markets of Africa and Asia. We have built several credit bureaus, have worked with central banks and regulatory authorities and implemented our solutions to local banks. This has given us great insights in risk behaviours of companies and individual customers of these countries, which has helped us in adapting our global models to local context. This in my opinion is our biggest strength and our leading edge compared to our competitors. We also have local presence and infrastructure in most of our target markets, which enables a constant dialogue with banks in the region with an objective of developing a better understanding of their needs and provide suitable solutions. We are also very focused in terms of our offerings and verticals, which allows us build a far greater depth in our focus areas.
Could you give us some anecdotes on how your risk analytics solutions has helped say the telecom companies quantify customer risk?
We are currently working with one of the largest telecom companies in West Asia, helping them predict the credit behaviour for new applicants and existing customers. This helps the companies and their customers in many ways. The customers are benefitted by having post-paid plans that are tailor made for their profiles and the telcos are benefitted as they are able to innovate with products customised for multiple segments and customers.
Any capex for the coming year? How would it be funded?
We continually keep investing to develop our platforms to make them more relevant to newer generations of customers and to customise them for the specificities of local markets. As most of our platforms have an international core the investments are mainly in modifications to suit specific countries and target market segments like Islamic Banking, Micro finance etc. All of our investments are funded using internal means.
We will be investing in our R&D efforts to create more robust models and platforms and expanding our geographical reach. These investments will be funded through internal accruals.
Any stake sale plans?
No. There are no such requirements at this juncture.
India Infoline Research Team / 15:28, Mar 13, 2015
Markets are now reinforcing the perception of an early interest rate hike by US Federal Reserve, with consensus calling for the hike taking place in June, when compared with the prior expectations of a hike in September.