Sunday, March 13, 2011

Visit to the Axis Bank

I needed to go to the Axis Bank on Saturday. My DEMAT account is with them. They had a partnership with Geojit BNP Paribas to provide the online trading platform, which I was using. But this partnership will cease to exist from 20th of March. Axis has come up with their own trading platform, called Axis Direct. I was to close the Geojit account and open a new trading account with Axis Direct. In the two hours I required to finish up the account opening formalities, I came to know a few unrelated things as well.

Opening trading account is a laborious process. They have a form booklet of more than 100 pages, requiring 50 plus signatures. The person guiding me in filling up the form was multitasking - taking calls, attending to other customers and so on. As a result I would finish filling up a portion of the form and wait for him to turn to me. During these intervals I overheard some of the customer conversations. I interjected on few occasions as well. The next paragraphs are about my incidental learning.

Axis Direct, the online trading platform is provided by Axis Securities and Sales Ltd (ASSL), which is formed after Axis Bank acquired Enam Securities last year. ASSL manages all securities business of Axis Bank. Axis Direct is launched in January. It's yet to have a mobile platform.

Axis Bank also has a strategic tie-up with Max Newyork Life Insurance company to provide bancassurance. After the new IRDA regulations on Unit Linked Insurance Policies (ULIP), the existing ULIP customers panicked and they are surrendering the polices. One guy, probably a sub-agent, was telling that he had surrendered 5-6 ULIPs in the previous week. The bank no longer sells any ULIP products. They start the conversation with the customer by telling them upfront that it's not a unit linked product. What is striking is that the bank (and other agents) positions the life insurance products as savings instrument with some fixed assured returns. They tell the customer that if she invests this much amount she will get that much amount after so many years.The risk coverage aspect is not mentioned at all!

The bank is actively trying to cross sell products - mutual funds to savings account customers, insurance products to trading account customers and so on. One last thing I knew is that the bank now does not have a money withdrawal slip. Earlier there used to be different types of colored slips for deposit, withdrawal etc. When a person asked my guide where he could get a withdrawal slip, he asked him where his ATM card was. He said that he lost it. Then the person was told to withdraw the money from the counter through (bearer) cheque!


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