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May 19, 2001
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Money > Business Headlines > Report May 19, 2001 |
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HDFC Group, i-flex in banking solutions joint ventureBipin Chandran Leading financial services solution provider i-flex has entered into a 50:50 joint venture with HDFC Group. The joint venture is targeted at banking solutions requirements of small and medium sized banks in the country. The new company named Flexcel, will be headquartered in Bombay. Explaining the business model of the new entity, Deepak Ghaisas, chief executive officer (India operations) i-flex said, "There is a large market of co-operative banks and branches of large banks in remote areas, which need IT solutions. Many of them do not have the money to buy financial softwares. We will offer our solutions to these banks on a pay-per-use model." The tie-up with HDFC Group is a shift in i-flex's strategy of from traditional business model of software licensing. Under the new model called Application Service Provider model, the users will not be required to buy the software from the software companies. Instead, they can access the software using the Internet and pay in accordance with the duration of time they use these services. In the first phase of the operations, Flexcel will target co-operative banks with wider customer network. "We are expecting the initial transactions on this model to start by October this year," Ghaisas added. Pointing out that the new combination as beneficial for the company, Ghaisas said, "We have the technical know-how and HDFC Group has the knowledge of the banking sector. The joint venture expects to break-even in the next 18 months." Dwelling on future plans, Ghaisas said the joint venture company is looking at alliances with broadband network providers to reach banks in remote locations in the country. i-flex has also ruled out being effected by the US slowdown. "We have about 60 per cent of revenues coming from products and the rest from the services. Beside, we have a wide geographical spread not to get affected by the US slowdown," he explained. i-flex, which began its operations about eight years ago, is a global player with over 260 financial institutions as its customers across 70 countries spanning the Americas, Europe, Middle East, Africa and Asia. The company currently employs more than 1,500 professionals. Powered by YOU MAY ALSO WANT TO READ:
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