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Rahul Bhagat

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SBI General Insurance CFO

CFO Plays Multiple Roles Beyond Finance Sector: CFO, SBI General Insurance

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Considering the current inflationary situation that is existing globally, the investments have gone down that has impacted a lot of economies, according to the media reports. It is vital for the management and CFOs to know about the working-capital requirements to withstand recession as controlling the cash outflow is important and becomes even more essential during hard times like a global slowdown, said Rikhil Shah

A CFO (Chief Financial Officer) comes with a deep understanding of all aspects in an organization and not limited to finance, says Rikhil Shah, Chief Finance Officer and HR Head, SBI General Insurance.

The roles, opportunities and trends in CFO Community have been evolving since recent past. Considering the current inflationary situation that is existing globally, the investments have gone down that has impacted a lot of economies, according to the media reports.

While explaining about growth trajectory in the CFO community, Shah answered a few questions to BW Businessworld during an interview.

In what ways have the role and duties of CFO changed in recent times?

Over the years, the role of a CFO has seen a strategic shift. CFOs traditionally used to be number crunchers who worked silently behind the scenes. Today, however, the role has undergone a colossal paradigm change. A CFO comes with a deep understanding of all aspects of an organisation, not limited to finance or aspects such as capital allocation, business agility and resilience, mitigating operational risks, but across a wide spectrum including supply chain management, macro trends, digital adoption, and even ESG. Given that they work in tandem with the CEO, providing critical insights and advice on the potential outcome and growth opportunities for business initiatives, CFOs are well-positioned to play a pivotal role in shaping the future of their respective industries.

The role of a CFO in the insurance sector has seen a remarkable evolution from merely heading financial operations to building and heading strategic corporate imperatives for insurance providers. In this sector, CFOs are actively driving decisions for business, reinsurance, enabling capital optimisation, bringing in analytical thinking, and more. This is also largely due to the digital transformation witnessed by insurers, coupled with growing regulatory demands, compliance and data-governance benchmarks, etc.

CFOs understand the importance of value creation for investors, shareholders and other stakeholders that further aids the CEOs’ strategic vision. Since CFOs are at the center of it all, they can stay at the forefront of leading the shift in the ecosystem, and helping insurers navigate the changing landscape.  

What opportunities have evolved in recent times for the CFO community?

Today, CFOs have a much-evolved role as they also contribute as strategic advisors by utilising the correct data and insights to tap into newer opportunities that can help businesses scale. It can be attributed to their comprehension and real time view of the company’s finances, market environment, and regulatory climate.

In recent times, CFOs analyse key stakeholder connections and develop a solid understanding of their motivating factors. They are proactive in their communication and also manage contact with the media, clients, investors, and regulators strategically.

CFOs oversee a recurrent value narrative and are well-versed with the corporate narrative providing confidence to stakeholders.

In what ways and to what extent digitisation has been implemented in the finance sector that has served good results?

Digitisation in the Banking, Financial Services and Insurance (BFSI) sector has substantially transformed the method of operations and has strengthened efficiency and accuracy by leveraging technologies like Artificial Intelligence (AI), Machine Learning (ML) and predictive analysis. In the Insurance sector, we can now process claims online in no time with just a click on a website or on a mobile app thereby reducing the time in policy writing, all thanks to rapid digital advancements.

On similar lines, it also helps insurers in building large distribution channels and speeding up underwriting procedures at a low cost. Digitisation has modified the traditional business models creating new opportunities for the insurance industry. The advancement in technologies is also helping insurers in addressing persistent problem of insurance frauds across the globe. AI acts as gatekeeper preventing insurers from being a victim of insurance claim fraud. Adoption of tech based innovative solutions like digital documents transfer, digital signature, video KYC (know your customer) for identity verification, geo-tagging for address verification etc. has become instrumental in avoiding frauds. 

How may finances be secured for the future amid a global slowdown?

It is vital for the management and CFOs to know about the working-capital requirements to withstand recession as controlling the cash outflow is important and becomes even more essential during hard times like a global slowdown. The company should diligently evaluate the operational cost and strategically plan to minimize the non-essential expenses.

The company should review its capital structure on a regular basis to achieve flexibility in the hard times, check on the liabilities and reevaluate pre-decided/planned initiatives such as acquisitions, capital intensive projects etc. While planning for recession, companies should only take decisions based on data and metrics to ensure team collaboration and timely resolutions to defeat any kind of losses.

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Deloitte India Named Romal Shetty As CEO For Four-Year Term

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The employees of the firm were informed that the equity partners had confirmed Romal Shetty’s candidacy, on 29 November. After considering various candidatures, the nomination committee finalised Shetty for the position

The president of consulting for Deloitte India, Romal Shetty has been named as the CEO (Chief Executive Officer) of the firm for a tenure of four years. He will assume the position beginning from 1 April 2023, disclosed a mail sent to all the employees of Deloitte, India on 29 November.

The nomination committee informed all partners on 22 November about Shetty’s nomination as CEO designate of the firm, pending partner ratification.

After considering various candidatures, the nomination committee finalised Shetty for the position, who leads the firm’s consulting business in India.

The employees of the firm were informed that the equity partners had confirmed Shetty’s candidacy, on 29 November.

In the last five years, Shetty has led the growth of the consulting practice ranging from 2,000 to over 10,000 people along with consulting in India being the fastest growing practice across the Deloitte network.

Shetty’s appointment is succeeding N Venkatram, who previously led Deloitte India to its highest growth years in the history of the firm.

Venkatram scaled up the advisory practice and responded to new and complex client issues while continuing to grow the audit and tax practice. During last two years alone, Deloitte India increased its headcount nearly two times and expanded to tier 2 cities such as Coimbatore, Bhubaneshwar and Thane. Also, he played an instrumental role in onboarding more than 300 executives and around 20 partners from KPMG, followed by the acquisition of BMR’s tax team.

Shetty various roles includes being a member of the Deloitte global consulting executive, a member of the Deloitte India executive committee and the regional leader for Deloitte in South India.

He comes with over 26 years of experience and has specialisation in leading large and complex transformation programmes across the business and technology domains.

Shetty has worked in more than 40 countries with a cross-section of Indian and global clients. It includes start-ups and public-sector enterprises, to shape their growth strategies.

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Vishnuhari Pareek Named As Head Of Finance At Arkam Ventures

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He is a Chartered Accountant by profession. He led various functions and has worked across large corporates, startups, and advisory. Previously, Vishnuhari Pareek was leading Finance role for the Used Car business at CarDekho

The early-stage venture capital (VC) Fund Arkam Ventures appointed Vishnuhari Pareek as the Head of Finance of the company.

Pareek comes with 15 years of operating experience and at Arkam Ventures he will be responsible for heading the finance function.

He is a Chartered Accountant by profession. He led various functions and has worked across large corporates, startups, and advisory.

Previously, Pareek was leading Finance role for the Used Car business at CarDekho. Prior to that he worked at Rivigo, where as an early member he played an integral part of their growth journey. Also, he has held key finance positions at ITC and KPMG.

Pareek sharing his views on his appointment said that he has always been passionate about the VC and start-up ecosystem. At Arkam, he appreciated how founders are building innovative solutions for Middle India and how mission-driven they are to empower. He feels excited to be a part of new team that fuels ground-breaking companies of tomorrow.

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SBI Govandi Branch In Mumbai Alters Its Weekly Off To Friday

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According to the notice served on 1 December, the SBI Govandi Branch will remain shut on all Fridays along with 2nd and 4th Saturdays of the month. Media reports suggested that branches of certain other banks in the city and some other parts of the country also provide half-day working on Sunday

The public sector State Bank of India’s (SBI) Govandi Branch have changed its weekly off from Sundays to Fridays with effect from 1 December, reported a media house,

A notice to the effect has been put outside branch premises. This move is supposedly intended to facilitate the local minority population living in and around Govandi, a north-eastern suburb.

According to the notice served on 1 December, the SBI Govandi Branch will remain shut on all Fridays along with 2nd and 4th Saturdays of the month.

The business hours will operate normally from 10 a.m. to 4 p.m. daily, stated in the notice, starting from Sunday to Thursday.

There were even other reports apprehensions about the SBI Millenium Branch in Dadar following the suit. The branch officials, however, on 29 November outright dismissed the claims.

Media reports suggested that branches of certain other banks in the city and some other parts of the country also provide half-day working on Sunday. This is compensated by all Saturdays off, considering local people’s convenience.

The Govandi SBI Branch move has elicited strong reactions on social media with objections to the Friday closure to cater to “the demands of the local demographics”, and called for regional coordination for uniformity in the concerned areas.

According to Banking circles, in the digital era, there’s exists very little meaning to weekly offs or public holidays, when most banking functions are conducted online. This is due to the operations that bank continue irrespective of the calendar dates.

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SBM Bank India Announces Strategic Partnership With Zwitch

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Partnership with Asia’s first end-to-end Embedded Finance platform Zwitch would Offer SBM Bank No-Code, Low-Code Solutions and API-based embedded finance solutions for Fintechs & Non-Fintechs. It looks forward to democratise access and reduce the go-to-market time. Also, it will help businesses unlock new revenue and engage with customers better

SBM Bank India and Open Financial Technologies announced a strategic partnership on 29 Niovember. This move is taken for launching Asia’s first end-to-end Embedded Finance platform Zwitch to offer a no-code, low-code and full-stack API solution that enables fintechs to build their own financial products using Zwitch’s technology stack, comprising of a drag-drop dashboard, low code plugins along with 300 and more APIs (Application Programming Interface).

Non-fintechs such as SaaS platforms, health-techs and more, can also use this platform to embed financial features into their product or service.

For the first time SBM has opened its rails to an Embedded Finance player to roll out these services to the larger enterprise and start-up community. Using a service like Zwitch significantly reduces the go-to-market timelines for these businesses, increases their revenue streams, creates newer avenues to engage with existing and new users.

For instance, ERP (Enterprise Resource Planning) and payroll companies can embed banking and cards into their products, retail stores can offer co-branded cards or pay later solutions to their customers.

Zwitch is built and operated by Open which is the fastest-growing digital banking enterprise in the world. It serves more than 3 million businesses and processes annual transactions worth more than USD 30 billion.

The co-founder and CEO of Open, Anish Achuthan, speaking about the partnership said, “This is a very important partnership that helps democratize fintech for everyone including banks, fintechs, startups, small businesses and more. Through our interactions with businesses, we identified the need to embed financial features like savings accounts, credit and debit cards, lending and more, can open-up new streams of revenue generation and profitability.”

“If these businesses were to take the traditional route of building the technology and getting the required compliances in place, it will take them more than 18-24 months to get an MVP done apart from the high costs involved. With Zwitch, we have built the technology ensuring businesses can embed financial features in a matter of weeks, at 10 times lesser cost using our no-code drag’n’drop widgets or full stack APIs for developers and without having to worry about compliances. This is going to democratize fintech for all and redefine the Indian business landscape and we are happy to partner with SBM Bank India to amplify this mission,” he added.

Head of Retail and Consumer Banking, SBM Bank India, Neeraj Sinha, commented, “Our partnership with Zwitch will enable us to further strengthen our value proposition and open new doors for those aspiring to tap digital banking to make a positive difference in and around them.”

Previously, Zwitch powered Fedo.ai which is a health tech company to launch first health savings account in India. In the recent past, Zwitch was available only to select clients in limited beta. More that 50 businesses have built their fintech features using the platform. With this partnership, Zwitch’s technology and services will be available to the larger business community.

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Rupee Posts 8 Paise Up To 81.60 Against USD Led By Foreign Capital Inflows

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In the previous session on 28 November, the rupee surged 3 paise to end at 81.68 against the dollar. Brent crude futures being the global oil benchmark, rose 1.39 per cent to USD 84.35 per barrel. The dollar index slipped 0.38 per cent to 106.28. It measures the greenback’s strength against a basket of six currencies

The rupee went 8 paise up to 81.60 against the US dollar during early trade on 29 November. This is followed by boosted investor sentiments due to foreign capital inflows and a firm trend in the domestic equity market.

According to the forex dealers, apart from this, a weak American currency in the overseas market helped the domestic unit.

The local unit opened strong at 81.58 against the dollar. However, later it inched lower to quote at 81.60 which registered a rise of 8 paise from its previous close, at the interbank foreign exchange.

In the previous session on 28 November, the rupee surged 3 paise to end at 81.68 against the dollar.

The dollar index slipped 0.38 per cent to 106.28. It measures the greenback’s strength against a basket of six currencies.

Brent crude futures being the global oil benchmark, rose 1.39 per cent to USD 84.35 per barrel.

The 30-share BSE Sensex was traded 164.06 points or 0.26 per cent higher at 62,668.86. On the similar lines, the broader NSE Nifty went up 59.10 points or 0.32 per cent to 18,621.85, in the domestic equity market.

Foreign Institutional Investors (FIIs) sold shares worth Rs 935.88 crore, which made them net sellers in the capital markets on 28 November, revealed the exchange data.

Also, on 28 November, S&P Global Ratings reduced the economic growth forecast of INdna for the current fiscal year to 7 per cent. It, however said that the domestic demand-led economy will be less impacted by the global slowdown.

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Global Economy May Slowdown More In 2023, According To Big Banks

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The has been an increase in U.S. Federal Reserve’s interest rates by 375 basis points this year, ever since it rolled out its first hike in March. Many banks see a fall in the euro below parity to the dollar during the year, before clawing back by year-to-end

The largest investment banks in the world expects global economic growth to slow ahead in 2023 following a year affected by the RussiatoUkraine conflict and soaring inflation. It triggered one of the fastest monetary policy tightening cycles during recent times.

The has been an increase in U.S. Federal Reserve’s interest rates by 375 basis points this year, ever since it rolled out its first hike in March. Since then, a spark in worries about a recession existed. Even the central bank is expected to temper its pace of hikes.

Real GDP (annual Y/Y) forecasts for 2023 reads as follows:

Bank Global U.S. China Morgan Stanley 2.20 per cent 0.50 per cent 5 per cent Goldman Sachs 1.80 per cent 1 per cent 4.50 per cent Barclays 1.70 per cent to 0.1 per cent 3.80 per cent J.P.Morgan 1.6 per cent 1 per cent 4 per cent BNP Paribas 2.3 per cent to 0.10 per cent 4.50 per cent UBS 2.1 per cent 0.1 per cent 4.5 per cent BofA 2.3 per cent to 0.4 per cent 5.5 per cent Credit 1.6 per cent 0.8 per cent 4.5 per cent Suisse Deutsche Bank 2 per cent 0.8 per cent 4.5 per cent

U.S. inflation forecast for 2023 and Fed terminal rate forecast as follows:

Bank U.S. Inflation Fed Terminal Rate (annual Y/Y for 2023) Morgan Stanley Headline CPI: 3.3 per cent 4.625 per cent Core PCE: 3.8 per cent (by Jan ’23) Goldman Sachs Headline CPI: 3.2 per cent 5 to 5.25 per cent Core CPI: 3.2 per cent (by May ’23) Core PCE: 2.9 per cent Barclays Headline CPI: 3.70 per cent 5 per cent to 5.25 per cent (by March ’23) J.P.Morgan Headline CPI: 4.1 per cent 5 per cent Core CPI: 4.2 per cent (by Jan ’23) BNP Paribas Headline CPI: 4.40 per cent 5 per cent to 5.25 per cent (by Q1 ’23) UBS Headline CPI: 3.6 per cent 5 per cent BofA Headline CPI: 4.4 per cent 5 per cent to 5.25 per cent (by March ’23) Credit Suisse 4.75 per cent to 5 per cent Headline CPI: 3.8 per cent (by March ’23) Deutsche Bank Headline CPI: 4.3 per cent 5.125 per cent.

Morgan Stanley by March ’23 sees the Fed delivering its first rate reduced by December 2023, taking the benchmark rate to 4.375 per cent by the end of that year. Barclays foresees the rate between 4.25 per cent and 4.50 per cent by next year ending, whereas Deutsche Bank sees it at 4.625 per cent after a rate cut.

According to UBS, it expects the U.S. inflation to be “close enough” to the Fed’s 2 per cent target by the end of 2023 for the central bank to consider rate cuts. BofA sees the rate between 2.75 per cent and 3.00 per cent by the end of 2024.

Forecasts for currency pairs, yields on U.S. 10 to year Treasuries, S&P 500 target by the end of 2023: Bank EUR/U USD/C USD/J S&P 500 U.S. SD NY PY Target 10 to year yield Morgan Stanley 1.08 6.8 140 3,900 3.50 per cent Goldman Sachs 1.05 6.9 140 4,000 4.34 per cent Barclays 1.05 7.3 131 3.75 per cent J.P.Morgan 1.0 7.2 133 3.4 per cent BNP Paribas 1.06 6.9 128 3,400 3.50 per cent UBS 1.04 6.9 135 3,700 3 per cent (by June 2023) BofA 1.1 7 137 4,000 3.25 per cent 1.02 7.3 135 4.10 per cent Credit Suisse Deutsche Bank 1.1 6.8 125 4,500 3.65per cent.

Many banks see a fall in the euro below parity to the dollar during the year, before clawing back by year-to-end. As of 1317 GMT on Nov. 28, 2022: EUR/USD: 1.045 USD/CNY: 7.197 USD/JPY: 138.50 U.S. 10 to-year Treasury yield: 3.67per cent S&P 500 level (as of close on 25 November): 4,026.12

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SEBI Forms 20 Members Committee To Review Corporate Takeover Rules

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The new panel will be responsible to review the current rules in the light of past judicial pronouncements and various informal guidelines, which have been issued by SEBI till date. The committee having representatives from stock exchanges and law firms will also have to make suggestions and measures to facilitate ease of doing business.

The capital markets regulator of India, Securities Exchange Board of India (SEBI), has formed a high-level panel to review corporate takeover rules. This comes after the Asia’s third-biggest economy seeking establishment of contemporary M&A regime that that is burning followed by the Global Financial Crisis and the emergence of new buyout modes undergirded by private-equity financing. Such move may be the first anticipated overhaul in more than a decade.

The committee formed, will consist of 20 member which will be headed by former Chief Justice of Punjab and Haryana High Court, Shiavax Jal Vazifdar. The Achuthan committee reviewed the takeover code last in 2009.

The new panel will be responsible to review the current rules in the light of past judicial pronouncements and various informal guidelines, which have been issued by SEBI till date.

Out of all members of the committee, some others include Ankur Verma, senior vice president, Tata Sons; professor Umakanth Varottil, faculty of law, National University of Singapore; Sudhir Kumar Jha, head of legal, HDFC, Sunil Sanghai, founder of NovaDhruva Capital and Sundareswaran S, managing director, Morgan Stanley Financial Advisors.

The regulator will be receiving advises and suggestions from the panel on simplifying and strengthening the current norms by adopting appropriate global practices. The committee having representatives from stock exchanges and law firms will also have to make suggestions and measures to facilitate ease of doing business.

SEBI, in 2011, had retained and continued the inherent and basic objectives of control highlighted by Justice PN Bhagwati, when takeover regulations were overhauled considering the recommendations made by the late C Achuthan, former presiding officer of the Securities Appellate Tribunal (SAT). Justice Bhagwati had chaired the committee that reviewed the takeover code of 1997.

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Siddharth Sehgal Is New CFO Of BeatO

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Prior to joining BeatO, Siddharth Sehgal worked with EY (Ernst and Young), India as an Associate Partner, International Tax and Transaction Services

BeatO, announced the appointment of Siddharth Sehgal as its new CFO, on 29 November. It is a comprehensive digital care platform for controlling and reversing diabetes.

Sehgal comes with more than a decade of leadership experience and 20 years of rich and diverse experience in M&A, financial planning and analysis, tax and regulatory matters. He will be responsible for re-orienting the finance function commensurate with BeatO’s scale up plans and assisting in charting out long term strategy at BeatO.

The Co-Founder of BeatO, Gautam Chopra speaking on his appointment, said, “We are pleased to on board Siddharth as our Chief Financial Officer. His in-depth knowledge and diverse experience will help BeatO in charting its strategic direction and priming the organization for our aggressive growth plans. Siddharth will also be developing a process led organization with a strong governance framework.”

Previously, Sehgal was working with EY (Ernst and Young) India as an Associate Partner, where he assisted clients in transaction structuring, deal execution and tax and regulatory matters, before joining BeatO.

Also, he has served various leadership roles in professional services with M&A as domain expertise, prior to EY.

Siddharth Sehgal commenting on his appointment said, “I am inspired by their mission and enthusiasm. BeatO have built a great team and a solid product. I look forward to contributing with my experience as we build BeatO for its next phase of growth.”

The company has recently raised 33 million dollars and is looking at strengthening their leadership further, as more roles open up within the company. Along with this appointment, BeatO has also hired fresh talent from B-schools including ISB (India School of Business), where BeatO was present on Day Zero and did hiring for roles across Product, Growth and the Founders Office to keep the momentum going.

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Economists Suggests FM To Step Up Capex, Cut Tax In Budget 2023

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According to the economists, considering the high inflation rate, providing a relief on income tax will boost domestic demand. In total, the finance minister has held eight rounds of discussions, beginning with India Inc on 21 November and ending with a round of consultation along with economists on 28 November.

The government is asked by the Economists to level up capital expenditure, rationalise personal income tax and stick to fiscal discipline in the upcoming Budget, on 28 November.

During the finance minister Nirmala Sitharaman led pre-Budget interaction, they also urged her to increase health care outlay and focus on quality job creation.

According to the economists, considering the high inflation rate, providing a relief on income tax will boost domestic demand. In their suggestion, the Centre should continue with long-term loans to states, meanwhile relaxing some of the spending restrictions and handhold them through fiscal management. Its focus should especially be on those with high borrowings.

The meeting was attended by the economists and experts along with N R Bhanumurthy of Dr BR Ambedkar School of Economics University, Ashwani Mahajan of Swadeshi Jagaran Manch, Poonam Gupta of National Council of Applied Economic Research, Monetary Policy Committee member Ashima Goyal, economist Karthik Muralidharan, Aditi Nayar of Icra, Santanu Sengupta of Goldman Sachs, Rahul Bajoria of Barclays, Madan Sabnavis of Bank of Baroda, and Deepak Mishra of ICRIER.

In total, the finance minister has held eight rounds of discussions, beginning with India Inc on 21 November and ending with a round of consultation along with economists on 28 November.

Expectedly, the Budget 2023-24 is to be tabled in Parliament on 1 February.

The finance Ministry said that with more than 110 invitees representing 7 stakeholder groups participated in all 8 meetings till date.

Also, she gave assurance to them on their suggestions to be considered carefully while preparing the Budget 2023-24.

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