HMA Starware, a software solutions provider, for the retail banking sector, has set up a strategic business unit (SBU) in Bangalore to cater to the needs of SME  bank segment including co-operatives, NBFCs, micro finance institutes and regional rural banks. The facility will also focus on expanding its partner base for its software products, according to a company statement.

HMA Starware Pvt Ltd (HMAS) a Chennai based banking software solution provider expects about 50% increase in its Rs 6.15 crore revenue for this fiscal. The impetus for the company’s growth this year is said to be provided by the co-operative banking sector which is advancing its technology to offer better service to its customers.

HMAS occurred 9 customers in the co-operative banking sector last year and about 35 per cent of the company’s revenue came from the operation in the segment, said S V Krishnamurthi, Chief Operating Officer, HMAS.

As the segment continues to be price sensitive, HMAS strategy to offer, comprehensive end-to-end solutions which include software, hardware, connectivity and services has enabled the co-operative bank to address the challenge of consolidating, streamlining and standardizing their operations, he said.

“We helped our customers to improve operational efficiency and management without disturbing their existing IT infrastructure,” he added.

While core banking solutions including licensing cost may cost about Rs 2 to 3 crore, HMAS switch based solution, ‘Ezlink’ will cost Rs 50 lakh for a year. For a bank with 5 branches on an average, handling about 200 transactions a day, Krishnamurthi said.

The turnkey solution offered by HMAS, cater to facilities such as Any Branch Banking, ATMs, KIOSK, Telebanking, Total Banking Automation, Asset Liability Management System, Data Replication, SMS banking and connectivity he said.

Some of the HMAS customers are Banglore-based, Amanath Co-op bank, West Bengal State Bank and the Andaman & Nicobar State Co-op bank.

Today, banking, in the new customer-centric market, is all about providing ubiquitous and innovative value added services. In a bid to build an effective customer/product ratio banks are offering a bigger platform for transactions, deploying ATM/POS terminals across bank
branches/retail outlets and connecting to international interchanges like VISA, Master, NFS, Cashtree etc.

However, with the increasing transaction base, banks are often confronted with the challenge of tracking the flow of funds and ensuring a balanced bank account of their clients. HMA Starware (HMAS) empowers the banks to fulfil this objective, through its customized software solution of reconciliation – “StarRECON”.

StarRECON helps to reconcile the ATM/POS transactions both for acquiring & issuing Banks’ own cards [private label] or VISA or MasterCard. Additionally, it enables reconciliation of other Network transactions thereby making the whole process of reconciliation and settlement requirements an easy task. The framework also allows the users to configure key information and provide all the relevant log details that can be used for audit purpose. Purging all the logs enables the user to delete the logs permanently from the database based on the configuration.

The system checks the missing transactions in the switch/TBA side or in Visa/Master side. The matching key fields are made configurable so that the user can easily set the key fields without much trouble. Changes to Visa/Master message format can be added comfortably without requiring any customization. After reconciliation, the system generates all the necessary reports to verify the amount settled across multiple ATM Sharing consortiums, so as to keep a check on the fraudulence or faulty claims and avoid error-prone manual reconciliation.

HMA STARware Pvt Ltd, a Chennai-based retail software solutions provider for banking sector, has expanded its client base in Bangladesh by tapping into the country’s leading bank, the Dutch Bangla Bank Ltd(DBBL).

HMAS’ turnkey project has catered to DBBL’s electronic fund transfer operations in the bank’s 33 branches, which offer services to about 1.4 lakh customers including about 54,000 card holders, said SV Krishnamurthi, Chief Operating Officer (COO), HMAS.

At present, HMAS’ solution has gone live with 100 ATMs and 550 point-of-sale (POS) terminals, he said. DBBL is expected to set up 150 more ATMs and 950 POS terminals by 2007, he added.

Apart from the basic functionality on ATMs, other proposed plans include value-added services, such as online bill payment, which will help customers to remit their electricity, telephone and water bills and also pay school and college fees through ATMs, Krishnamurthi said.

Customers will also be able to recharge their pre-paid mobile phones in the ATMs, he said. On availing this service, the requested top-up amount will be automatically debited from the customers’s account and an intimation will be sent to the service provider, he added.

The offered solution enables all the DBBL ATMs to accept DBBL-NEXUS ATM / POS card, DBBL-Maestro/Cirrus Debit card and DBBL Credit card, he said.

Krishnamurthi said, “Though our job ends with knowledge transfer, we do an end-to-end study of our clients’ requirements and offer them roadmaps and modules for implementation.”

HMAS is gradually building its presence in Republic of Yemen and in Western Africa, he said.

The company has also tied up with Bangladesh’s No. 2 bank and the project is expected to be completed by 2007, he added.

HMA STARware, a software development firm, expects business from African countries to help double its turnover next year, reflecting the tendency of small, niche IT players to tap into unconventional markets.

Mr SV Krishnamurthi, COO, HMA STARware(HMAS), said the demand for banking software in a number of smaller countries in Africa is picking up. This is partly driven by the central banks of these countries, and in some cases by World Bank funding. "We are excited about Africa," he said.

HMAS is a part of the Chennai-based HMA Group, and specialises in providing middleware, reconciliation and card-management solutions for retail banking. It reported revenues of $1.5 million in 2005-2006, and expects to double it this year on the back of more business-primarily from Africa and also from west and south Asia.

Th company had just completed an electronic fund transfer project for Dutch Bangla Bank, a Bangladeshi private bank with 33 branches and 1,40,000 customers. The solution has gone live with 100 ATMs and 550 POS terminals.

Mr Krishnamurti said there is similar demand from several countries in Africa as well, even as their central banks try to move their economies from cash to cards. "Priniting and managing currency has become a big issue in several small countries in Africa," he said.

Another boost is coming from post offices. HMAS has two clients in this segment at present-the postal departments of Ghana and Yemen. Mr Krishnamurthi said that in many African countries, the postal department had larger branch networks than banks. Besides, government salaries are disbursed through posts, he added.

HMA STARware Ltd(HMAS), part of the HMA Group and a provider of retail solutions for the banking sector in India, is betting big on the co-operative banking and primary cooperative sector for its IT infrastructure and back-up services.

The company,which has over 40 banks(both public and private sector) as its customers for its suite of products and solutions, has set its focus on the cooperative banks, which are gearing up for major IT spends in India, said SV Krishnamurthi, Chief Operating Officer, HMA STARware.

Talking with FE, he said: "Ever since we launched a suite of software products for the co-operative banks and primary co-operatives a few months back, the company has got orders from seven state cooperative banks and few primary cooperatives. "We are in final discussions with two more state cooperative banks, which over 120 branches. We hope to clinch the deal soon," he said.

Given the recent directive from the Reserve Bank of India coupled with the NABARD's help for these banks to upgrade their IT infrastructure, HMA STARware believes that the company will rope in more customers during fiscal, he added.

According to him, the company's Ezlink, a middleware platform will provide a seamless integration and interface of data at all branches network to provide a consolidate perspective to the customers. "Being an open source platform customers can easily upgrade to high-end technologies without replacing the existing products and suits of our platform," he said further.

The company is also servicing few customers in Bangladesh and South Africa and is in talks with few more cooperative banks in those countries, he added.

Imagine a coffee shop and a jeweller next door to it. They are not likely to see each other as competitors - they serve different customer needs and stock unrelated inventories.

In fact, they probably see themselves as complementing each other. For example, a man while sipping coffee might get induced to buy a diamond ring for his wife. Or, a couple, after a shopping spree at the jewellers, might decide to catch their breath over a cup of coffee next door.

Given the synergy, a coffee shop would be as comfortable inside a jewellery shop, as it would be inside a bookshop. (And most good book shops come with cafes these days.

But, this could change. In the near future, the coffee shop and the jeweller could be competing for the same set of customers. In other words, they would stock the same inventories and promise to serve the same customer needs - even if it’s for a small segment of their core clientele.

These inventories would not claim any extra shelf-space from the jeweller or extra time from attendants in the coffee shop. In fact, they would be getting into new segments: ranging from aviation and telecom to entertainment and utilities. And all these thanks to a humble device that already sits in the sales counter - the Point-of-Sale (POS) terminal — the e-equipment the merchant uses to swipe credit or debit cards.

Piyush Khaitan, Managing Director, Venture Infotek Global, a transaction management solutions company said, “Traditionally POS terminals have been used to facilitate card payment transactions.

But with the advent of new technologies the traditional POS terminal is now poised to undergo a sea of change.”Industry players point to a number of services such as mobile top ups, airline ticketing, utility payments, micro banking, retail loyalty applications and even gambling that could be offered through POS terminals. “The potential is even bigger - and might include a lot of other services we don’t even think of at present,” Mr Anup Nayar, vice-president of POS and value added services division of FSS, a company specialising in electronic payment solutions, said.

The tech driver

The growth of these services would be driven by technology and changing business needs. Mr Harish K Murthi, CMD of HMA Group, which offers technology solutions to the banking and financial sectors, said that any value-added service that could be offered over an ATM could be offered using a POS terminal because the back end was the same. “You just have to add a piece of software in a POS terminal to include more functions,” he said.

The business driver

The other key driver is changing business needs. “With more and more new services being unveiled and the increase in customer demand for efficient and convenient service delivery at his door-step, it’s almost definite that such enhanced services would be the order of the day,” Mr Khaitan said. If using POS terminals enables cost and service efficiency to operators it provides increased revenue to retailers, he said.

For a specific example, consider airlines. Today, it’s acknowledged that e-ticketing helps airlines cut costs. While a paper ticket costs over Rs 400 to process, e-ticket reduces it to less than Rs 50, according to industry estimates.

However, in India, e-ticketing penetration is estimated to be less than 15%. Industry players say one reason could be the reluctance of customers to share their card numbers with the call centre, or give it out online, for payments.

Letting customers pay POS terminals should solve this problem. Mr Nayar said, “We can clearly see ATM and Point of Sale Terminals as the only channel other than Internet which can service the spread of locations for ticket payments.” In fact, FSS has enabled e-ticketing through POS terminals.

Future bright

Besides, POS terminals offer a ready distribution channel for these companies. According to a survey by Venture Infotek, there are 2.08-crore credit cards and 5.37-crore debit cards (estimated) at the end of March 2006. “Today, there are more than 1.9 lakh terminalised merchants, in 150 cities and towns across India that accept payment cards as compared to 0.7 lakh merchants with POS terminals in 1999-00,” the survey said. It’s a segment businesses can’t just ignore, observers say.

Interestingly, even with all this, the introduction of value added services is likely to attract a completely new set of players into the market. Standalone players who would offer these services, not unlike STD/PCO booths before the mobile boom in the country.

Mr Nayar said these standalone players were likely to operate within shops or malls, tapping the regular footfall. Mr Khaitan added, “We do believe that standalone players ... would enter the market once the volume and size of this business increases in India. With more and more customers seeking higher service levels this market is poised to grow. And with this growth more and more players including standalone players will also enter the market.”