In a career spanning over three decades, I chose to play like a one-day cricketer, not bothering about what my score would be at the end of my innings. It is important to make every day count and that’s all I have done. Obviously, there were those who disliked the speed but once the results started coming in, people’s habit for procrastination and sitting on things changed.

I was asked to join the DFS [department of financial services] four weeks before my appointment date – on August 1, 2011 – and that gave me a chance to understand the role, the objectives and functioning of the department. Having worked with IL&FS [Infrastructure Leasing & Financial Services Limited], the department of commerce, and also department of industries in UP, I had a decent idea of how the banking system looks from the other side, and the problems it faces.

One of the first observations I made (after assuming charge) was that the department had not realised its potential. It had taken a backseat and wasn’t considered an integral part of the finance ministry. If there is anything important in an economy, apart from the capital market, it is banking. If banking, insurance and pension are not working well, how can the economy function well? So it was very much the responsibility of the department [of financial services] to give its best for the economic growth of the country. And getting the department to realise this, and work accordingly, became my immediate task.

I noticed that DFS did not have a compact office, though it has been in existence for so many years. We had an office spread in more than three buildings within the same complex. So, to begin with, we got the entire second floor vacated and brought the insurance, pension and banking divisions together. This simple change brought about greater efficiency in terms of the department’s functioning.

Our distance from North Block has its own pros and cons (DFS is located on Sansad marg about two km from North Block). While the secretary and other senior officials of DFS are unable to attend meetings that the finance minister calls in a hurry, or can meet him only once a week or so, we were saved from unwanted interference and disturbances—in terms of people dropping in for a casual chat or those coming in for recommendations, transfer approvals, promotions, loan sanctions, loan waivers, etc. These calls (people dropping in for recommendations) made us look more like a department of transfers of the Indian government!

The next thing I worked on was enhancing communication within and outside the department. We set up advisory groups for each sector/sub-sector comprising senior officials from the department along with experts from various fields. Wherever necessary, we also involved the regulatory authorities. These groups were being headed by an additional secretary or joint secretary, who set their own roadmaps. In addition, I spent around two hours meeting others almost every day—something we don’t do in a structured manner.

Meeting representatives from various organisations, listening to their ideas and seeking their feedback on the existing systems helped us in framing policies. It also ensured greater participation of all stakeholders, and no one could complain that his/her concerns or ideas had not been heard.
While dealing with people, it is important to remember that everything cannot be done by simply ordering them around. It was very important to keep things informal at times because too much bossiness can de-motivate people.

For instance, there were some regional rural banks (RRBs) that were not on core banking solution (CBS) and the September 30, 2011, deadline [for all banks to implement core banking solutions] had been fixed before I assumed office. I asked for the list of six or seven RRBs that were facing trouble in implementing the CBS system. Instead of summoning the chairmen of these banks and slamming them, I gave them a call and simply asked them why they couldn’t get it done despite their huge size.

I also slipped in a personal word that the government had made a commitment and it wouldn’t look nice if we do not honour it. That did the trick, all those banks put in additional manpower and other resources and we achieved our target.

Why give up pursuing ideas/issues midway?

One sad thing about policymakers today is that we have given up on the idea of pursuing things till the very end. Beginning with great zeal and then giving up in the middle, or just towards the end, has become a common trait among most policymakers, and that is not healthy for the country. I used to constantly review what was on the agenda of my additional secretaries and joint secretaries and discuss with them the status of each case.

During my tenure, about ten new bills and amendments to existing Acts were prepared and then sent to the cabinet for approval. So it is not that the government cannot deliver. The government has a problem with the process but then bureaucrats have to put in a lot of extra effort. We need to be a little more proactive and use  a jumbo jet engine to move even small things. That’s so much more effective than trying to change the entire government on your own.

Enhancing financial inclusion was my primary focus and when banks gave us feedback—that it was not economically viable for them—we started looking at different models. One method we adopted was area-wise bidding for ATMs. Until then banks used to bid at the rate of ' 14-16 per transaction but because of area-wise bidding, the costs nearly halved. This meant a saving of about '3,500 crore to '4,000 crore each year for all public sector banks. We also brought in the concept of ultra small branches (USBs) which has done well since then.

The other strategy was bidding for point of sale (PoS) where, again, there was resistance. We got offers from vendors in which the PoS will be available at zero cost to both the customer and the trader, and that was what we really wanted. Until then, the PoS mechanism was not being used since traders were being charged and they were not interested in paying.

An important internal problem that the banking system faces is the term of the chairperson which is generally 1-2 years. In no country would a chief operating officer be appointed for only a year. Even lower-level employees would not want to take up a job seriously if they know that they’ll have to move out of the organisation after a year—and here, we are giving the chairpersons of banks with deposits of ' 100,000 to 10,00,000 crore a one-year tenure!
One should appreciate the fact that with tenure comes accountability. So we decided to change this policy. We went through the reports submitted by various committees and got the tenure of the SBI chairperson extended, which has been approved by the prime minister. And to bring about a sea change in the way our banks function and perform, this is one of the key policies that needs to be adopted by all the other public sector banks as well for which the proposal is pending with ACC.

These were some of the initiatives we undertook, and hopefully these are being pursued even today.
Change is the only constant. We all know it and yet try resisting it. But how one overcomes these hurdles and manages change without forcing it is what really matters. That is how the frequent meetings within and outside the department helped. In the first three-four months, I had a lot of discussions with the additional secretary, joint secretaries, and others, and we would have fierce debates.

Following the implementation of a few policies that yielded good results, there was confidence in my leadership. The department became a lot more result-driven and this is how everybody started enjoying the process. To boot, we had become a lot more visible and our participation in the decision-making/implementation process improved significantly.

There definitely is a long road ahead but, like I mentioned before, if individuals just play the game one day at a time with full conviction, the scoreboard will automatically keep ticking.

(As told to Srishti Pandey)