IIBF EXAMS UPDATES 2024 | IMPORTANT CHANGES FOR INDIAN INSTITUTE OF BANKING AND FINANCE EXAMS

IIBF EXAM UPDATES 2024 | BANKING EXAM UPDATES 2024

This post provides the latest banking trends, changes & developments relevant t IIBF Exams updates 2024.

So many bankers sit for the IIBF’s banking papers such as JAIIB, CAIIB, and Certification. Though the Syllabus & Study material comes recommended by the institute still there are some things that bankers/ candidates forget to prepare for and that is The banking updates.

Yes, updates & developments in the industry you work in are just as important as the syllabus that you read for your exams. And Learning Sessions keeps the students who are attached to it updates & ready for the iibf exams!

So, Make the most of your Exam preparation!

Practice mocks, Revise the syllabus with the best JAIIB, CAIIB, Certification and Promotion courses! Head to our store (links at the end of this page).

FINTECH CHALLENGES FOR THE BANKING INDUSTRY

There have been many disruptions in Technologies across the globe and most of them happened in the service sector whether it’s Amazon, Uber, OLX or Wikipedia or Google. Technology changes have made the process of retail buying, availing taxi services, and searching chose for information easier.

You will see the most consistent and common characteristic of these advancements is the ease of the process.

On the same footing, the process to obtain financial services has become faster, more efficient, and more customer-friendly with financial technology (fintech). The solutions made available by fintech companies are here to offer the target niche services. Other services have become so popular in a very short time that different Tech startups have disrupted the financial industry altogether.

DATA:

There are more than 2000 fintech companies in India right now and as per economic times, their market capital was up to 31 billion US dollars in 2021. It’s amazing that two third of these have been set up all in the last 5 years.

There are 200 fintech unicorns across the globe and 10% of the fintech unicorns are based in India, namely, Mobikwik, Oxyzo, Cred Avenue, Billdesk, Bharat Pay, Razor Pay, Phonepe, Zerodha, Pine Labs and Coin DCX, etc.

FINTECH SEGMENTS WORKING IN INDIA

The areas in which the Indian fintech companies are working can be named:

• Real-time payments,
• Quick loan disbursement,
• Investment Advisory,
• Peer-to-peer lending,
• Insurance advisory,
• Personal Finance,
• Gold lending,
• Insurance services etc.

These all services are used to require human capital on a large scale but these have quickly integrated into the digital native fintech landscape.

Diving deeper into the segments, you will find the following fintech companies working in India:

PayTechs: These Tech firms work on payment security, card networks, white-label solutions and payment gateways

Examples: Paytm, phone pay, and Google pay

LendTechs: These Tech firms provide consumer-focused services such as fixed-term finance and trade Finance, buy now pay later, personal loans, gold loans, salary loans as well as p2p lending, you got the gist.

Examples: Google Pay, Razor Pay & M-Swipe.

Digital banking: The banking sector is currently leveraging technology by establishing the digital subsidiaries of banks, retail Neo banks, and small and medium Enterprise Neobanks. New banks are basically digital platforms for commercial banks.

Example: YONO of SBI, khatabook etc.

InsurTechs: These Tech firms provide services such as employee insurance, digital insurance, electronic insurance as well as insurance comparison platforms where claim management, underwriting of risk management, insurance infrastructure, insurance product configurator, and such services are provided.

Example: Policybazaar

WealthTechs: They provide discount brokers, mutual fund investment platforms, research platforms, and alternative investment platforms two wealth and expense Management Services.

Example: Zerodha and Smallcase

RegTechs or Regulation Techs: Compliance and regulatory Services such as know your customer, digital onboarding, fraud detection, and anti-money laundering and banking compliance and risk management solutions are provided by these.

Fun Fact: The payment and lending segment contributes> 3/4 of the fintech business.

CHALLENGES FACED BY FINTECH COMPANIES IN INDIA:

Even the fintech companies are growing in India but it’s not like it doesn’t have to face any difficulty or challenge. These companies are often prone to risks that are as follows:

• Privacy leak
• Data security
• Platform downtime
• Financial illiteracy
• The disparity in adoption rate in MSMEs
• Changing regulations
• Lack of timely enactment of regulatory controls on some areas/aspects
• Revolving cryptocurrency, payment regulations, and data security are still evolving.

DATA: 

1100 lending apps available for Indian android users (600 are illegal lending apps)

Source: Working Group on Digital Lending (WGDL)

REGULATORY CHALLENGES

As China saw destruction due to unregulated Fintechs namely, Alibaba and Tencent. They became bigger than the local banks and were able to dominate the whole banking sector in the country, especially in retail banking and retail payment. They became both a blessing and a curse for China. Following them, other fintech Giants – Baidu and JD.com joined the train. No doubt that investment and innovation that these joints both in the economy helped but the next tenth of control and influence these fintech forms held over the Chinese people was a matter of concern.

This is the reason that in the late 2020s, the Chinese government suspended the most anticipated IPO (Jack Ma’s Ant Group) of the Year.

Then in early 2021, the Chinese government bandh banks to sell deposit products on online platforms for fear that the Rapid expansion of the largely unregulated and uncontrolled fintech sector will increase risk in the financial and social system. The Ban resulted in the locking up of deposits of a few lakh customers and brought unrest among the common Bank customers. 

Taking this as an example, other nationalities should learn to embrace and collaborate with fintech forms instead of opposing them. Reforms should be made to centralize the control of Fintech firms.

RBI’S REGULATION (10 AUGUST, 2022)

The process to develop guidelines for the growing sector begin a long time ago and the long-awaited regulatory framework for digital lending was issued by the Reserve Bank of India on August 10, 2022, which provided clarity on direct loan disbursements to borrow a comment and borrowers’ consent before increasing credit limit.

Many issues were addressed such as:

• Malpractices committed by illegal Chinese apps
• Putting a stop to data scraping from phones, obtaining explicit consent for data collection for lending
• Disclosure of all costs involved and cooling off period to exit digital loans

Considering all the facts, collaboration sings to be the best solution in the current scenario. It is capable to offer innovation, good quality ideas, and improvement in the lives of customers.

Ultimately, the customer is going to be the winner in the scheme of things.

BUT IS FINTECH REALLY BRINGING FINANCIAL INCLUSION OR IS IT A BANKING DISRUPTION?

As of now, the financial system is on its way to fundamental transformation. Fintech has provided a number of delivery channels and has helped in increasing the extent of Finance that can be lent to people living in remote areas by breaching the territory of traditional banking. The only way forward is to be more secure, have education and awareness, customer undertaking, regulate, and be a part of the evolution of financial institutions and financial systems.

Financial Technology is a new technology that aims to improve and automate the provision of financial services. Simply said, it’s a combination of financial services and information technology and this combination is as old as the time when computers were introduced in the banking system.

Financial technology is on its towards:

• Cost-effectiveness
• Accessibility
• Speedy delivery
• Transparency

Today’s young and tech-savvy Indian population has prepared the foundation for fintech to grow and evolve and that is the reason that India has become one of the fastest-growing fintech markets in the world. It has put doubts on the existence of the conventional banking system by blurring the boundaries between banking and financial technology. This is a matter of greater concern for Financial regulators and law enforcement.

In the era of Digitisation, there is a concern for public finance and data as the rates of fraud, data piracy, cyber-crimes, and unregulated financial agents have increased.

If we are to look back, we would see that financial Technology can be traced back to the 17th century.

ERA: Linkage: 1866-1967 was an era of linkage when telegraphs and railroads were being utilized for cross-border financial transactions.

ERA: Digitalization: 1967-2008 saw the invention of the internet and the system shifted from analogue to digital.

ERA: Mobile & start-ups: From 2008, as the mobile phones and in the market, it was kind of a revolution. Everyone Wanted a mobile phone and as Technology developed, it is now able to do almost all the things that a computer can do.

Now in India, fintech evolution has been the result of Technologies, regulatory interventions, and also because of the uniqueness of the Indian population. There has been a massive internet and smartphone penetration.

• High Investments
• Innovations in machine learning and artificial intelligence
• Tech-savvy population
• Indian digital infrastructure 
• Massive financial inclusion

India has the 3rd largest fintech ecosystem in the world and has an adoption rate of 87% which is higher than the Global average of 64%. The expected market size of fintech startups in India is 150 billion dollars in 2025 while it has been 8 billion dollars in 2021.

FINTECH INDUSTRY STRUCTURE:

The drivers that bring in the growth:

• Technological developments: Cloud-based solutions, big data, advanced security solutions.
• Market trends: Increasing online sales
• Penetration of mobile and Internet

FINTECH AND FINANCIAL INCLUSION

Fintech has reached the corners where traditional banking has not been able to. It has done so by democratizing the excess to financial products & world has moved a little closer to achieving the goal of financial inclusion by spreading access, usage and quality because of its lowered cost, increased speed and improved accessibility so far.

Framework for FinTech for financial inclusion

• Empowering access

• Enabling usage

• Expanding quality

• Scaling use

DISRUPTION:

With the rapid advancement of financial Technologies when compared to other sectors, these financial Technologies have essentially become the backbone of the present management system and we do not see the future without them to be honest. Fintech has an influence, unlike anything in the service sector. 

In the last couple of years, major disruptions have been made in the advancement of Banking that begin with the crisis of 2008 which was then followed by the advancement in financial technology. The joint efforts of the information technology professionals and Bank professionals during the 2008 financial crisis give way to the rise of fintech startups to resolve customer problems. The financial crisis resulted in the loss of Trust of customers and the after-regulations and compliance requirements by Financial Institutions had a great impact on the image and profit.

Although this disruption wasn’t only because of the rise of fintech firms, one of the major reasons was inherent flaws in the business model of traditional banking. There was:

• Delay in transaction processes,
• A lot of working hours,
• Effect of inflation on saving,
• Geographical limitations,
• Legal limitations etc also resulted in the disruption.

Fintech is carrying out transactions in relation to savings, investments, insurance, and credits at: 

• Cheaper rate
• Better than the traditional environment
• Do not have an administrative cost
• Do not need physical infrastructure

But it’s not like Bank have not embraced financial technology, they have adopted e-wallets, smart chip Technology, biometric sensors, branchless banking, chatbots, artificial intelligence, and blockchain Technology, but there is still so much that can be done with the technology in the banking system.

Someone needs to take the initiative to bring on the major transformations in the banking systems that are well instep to what the fintech firms have to offer. The areas it needs to work:

• Security
• Customer and Communication
• Expert, Education, and Training
• Regulation
• Evolution and Innovation

The thing to be seen is who and how this required change will be brought into the system to match the pace with Technology itself. A sector that has an experience of decades and even centuries have to have something that can back it up and meet up to only a few decades-old industries.

So, this was all about the banking updates that is relevant to the IIBF exams due in 2023.

THE RELEVANT STUDY MATERIAL FOR 2024 JAIIB | CAIIB | CERTIFICATION | PROMOTION

If you are preparing for any of the below papers:

• IIBF Junior Associate of the Indian Institute of Bankers 2024
• IIBF Certified Associate of the Indian Institute of Bankers 2024
• IIBF Diploma in Treasury Investment and Risk Management 2024
• IIBF Investment & Treasury Management 2024
• IIBF Risk Management 2024
• IIBF Diploma in Retail Banking 2024
• IIBF Certified Credit Professional 2024
• IIBF Anti-Money Laundering & Know Your Customer 2024
• IIBF Certificate course on MSME 2024
• IIBF Certificate Course in Digital Banking 2024
• IIBF Prevention of Cyber Crimes and Fraud Management 2024
• IIBF Debt Recovery Agent Examination 2024
• IIBF Debt Recovery Agent – Tele Callers Examination 2024
• IIBF Certificate in Rural Banking 2024

You can avail:

ONLINE CLASSES | MOCK TEST SERIES | EPDFS | UPDATES

Any one of the above materials for mentioned exams for 2024 at the below platforms:

• Android App: LS PRO & Website: iibf.info or 
• Android App: IIBF LEARNING CENTER  

• iOS App: My Institute 

• Website: Learning Center (Code: gegkt)