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December 27, 1999


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SBI To Reach Out To Indian-American Doctors

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Prakash M Swamy

The State Bank of India, the country's premier commercial bank, has drawn up plans to reach out to Indian-American doctors in a big way, S Sundar, president and CEO of the bank, said last week.

Sundar said SBI had realized that doctors face inordinate delays in getting their bills paid by insurance companies, sometimes spanning over three months. "Obviously, their income is blocked for three to four months and we had worked out an arrangement to help doctors," he said.

He made the comments at a function last Saturday to inaugurate the bank's branch in Flushing, New York.

The SBI would finance the bills against the receivables. It will offer loans against the receipts and doctors have to authorize the insurance companies to remit the dues directly to the bank, he said.

Given the holiday season, there was no immediate response to the proposal from physician groups.

"This way we ensure that the doctors have enough cash flow every month. We also help doctors set up clinics or purchase professional equipment," he said.

"Sometimes people ask us whether we are technologically backward compared to American banks. Frankly speaking, we may not match them on the high-end technology such as Internet banking. But we are no less inferior in terms of the basic and specialized services," Sundar pointed out.

"We are equipped with hitech communication system such as SWIFT to transfer money to India in about 24 hours. We can send money to anyone living even in a remote village where there is no bank at all. We also make arrangements to send drafts by courier service," he added. "This branch specializes in wire transfer of funds."

There are three SBI branches in New York. The downtown branch specializes only in business related to letters of credit and other trade-related operations and doesn't deal with individual customers.

"We handle a lot of Indo-American trade in this specialized branch which assists a large number of Indian public sector enterprises such as BHEL, IOC and HAL," he said.

The New York main office on Park Avenue deals with corporate customers as well as individuals and transacts $ 1 billion worth of business.

"Seventy per cent of the headquarters operations are toward India-based assets as SBI caters to some top companies in India. Almost all the top private and public sector companies deal with us with the SBI taking care of their overseas operations. We also help create nearly $ 50 million to $ 60 million dollar deposits back home by way of FCNR and NRNR deposits through this office," he said.

The bank has branches in Chicago and Los Angeles besides a representative office in Washington. The SBI California Bank, a wholly owned subsidiary of SBI, has been set up specially to cater to the needs of Indian-Americans in California. "Each state in the US has a different set of rules with regard to banking and certain activities of branch banking are not allowed in California. Hence, we floated a full-fledged bank," Sundar said.

He inaugurated the Saturday morning service by lighting the traditional lamp at a simple function held at the bank premises.

The 'Operation Saturday Banking' commenced on a grand scale. The branch transacted business worth $ 50,000 in just two hours of starting the service.

"We are touched by the response and this facility would bring us closer to our valued customers," Sundar said.

According to him, the Flushing branch is one of the SBI's popular retail outlets. The bank has eight offices in the US.

"We try to create a model out of every branch depending on the requirements and aspirations of customers. This branch is unique in the sense it takes care of the banking needs of hundreds of people," Sundar said

"Our customer base in this branch is as varied as the immigrant population itself -- cab drivers to temple priests, computer engineers to doctors, graduate students to businessmen."

Sundar said it did not take long for the SBI to realize that the Flushing branch's business hours clashed with office hours and customers found it difficult to transact business on weekdays.

As a first step, the branch was kept open late in the evening on Thursdays, but even this could not cope with the growing needs of customers. Hence, the present arrangement.

"The strategic advantage of our branch is the location -- the main street in Flushing. We help customers with the least waiting time and offer a boutique of services like remittances, deposits, NRI services, loans, bills collection, discounting and letters of credit to name a few," said V K Buch, senior vice-president in charge of the Flushing branch.

It helps customers open money market deposits, personal and checking accounts with a minimum balance of just $ 1,000 which earlier used to be $ 2,500. Buch said increasingly, more and more NRIs use the branch facilities to remit money back home.

"The remittance fee is a mere $ 15 whether the amount to be sent is $ 500 or $ 50,000. We accept cash up to $ 1,500 and if the draft amount is more, we require a certified check, cashier check or even a personal check," he said.

The State Bank, with over 9,000 branches in India and with 33 per cent of the country's market share, has computerized over 1,500 branches. This helps in faster wire transfer of funds, say within 24 hours in most cases. "We charge a nominal fee of $ 30 and even customers living in Boston, Albany and Edison seek our assistance in sending money to their near and dear ones in India," Buch said.

The Flushing branch could be described as a jewel in the SBI crown in the US. Last year, the branch netted deposits worth $ 17 million and helped NRIs remit over $ 50 million.

"We are also receiving remittances, bills for collection from other countries and other banks for businessmen and exporters in New York area," he said. "We also deal in trade advances, line of credit, bills, loans against securities like Resurgent India bonds or against FCNR or NRI deposits kept in India."

"Often, we fax remittance application forms to customers who may be living 1,000 miles away from New York. We mail them dollar drafts once we receive check for the amount, Xerox copy of the photo ID, and proof of residence along with the completed form. We can also wire transfer or send the draft to any address in India if they so desire," Buch added.

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