Formalizing the culture of Human Capital investment in Nepal; Interview with Sanjib Subba, CEO of National Banking Institute

Mon, Aug 6, 2018 12:54 PM on Exclusive, Experts Speak, Interview, Stock Market,

“When referred to as Entrepreneur, Mr. Subba prefers being called Empreneur. He says that in every organization that he has worked, he joined as an employee but with the mindset of an entrepreneur. It’s not just a different word, it is an attitude that influences your productivity and dedication”

Mr. Sanjib Subba, CEO of National Banking Institute, has an experience repository of around 3 decade. Mr. Subba’s academic background incorporates extensive studies on business in and out of the country. Not just the academics, prior to joining NBI, he has a history with Nepali banking industry working at Standard Chartered Bank and in International business studies working as the Executive Director of Webster University, Thailand.

NBI is a national level banking and finance academy, established with the combined efforts of Nepal Bankers’ Association (NBA), Nepal Rastra Bank (NRB), Asian Development Bank (ADB) and Rural Microfinance Development Center (RMDC) carrying an aim to provide trainings and to enhance the competence of the personnel involved in Nepali Banking Industry. Since 2010, NBI has been able to achieve certain milestones but we can still see a lot of lag when it comes to customer service in banks. So in this backdrop, Aakriti Thakali and Krishna Khatiwada from Sharesansar visited Mr. Sanjib Subba. The excerpts of the interview are:

You have dedicated quite a considerable amount of time in entrepreneurship and innovation. How has your journey been so far?

Actually to fair I’m not an entrepreneur as I haven’t started a venture on my own. But I do love to call myself an “EMPRENEUR”. The difference between an Employee and Empreneur is that, the Empreneur doesn’t just think from the perspective of an employee but goes beyond that to give the best shot for his/her company. So basically Empreneur comes from Employee+Entrepreneur. I had that kind of Empreneur DNA, so even-though I was an employee I always thought from the viewpoint of an Entrepreneur to ensure that any action I take is sustainable, viable and in the best interest of the company.

Coming back to Nepal, when joined NBI I was the first employee or to be precise the only employee. If you see today, we are now one of the fastest growing organization with the highest y-o-y growth rate of about 100% each year. So I’ve got a dynamic team of youths, who are working with the mindset of an Empreneur and not just for the sake of a job.

How was the idea of NBI conceived? Has it been able to fulfil the purpose it was established for so far?

NBI was actually not my idea, I was actually working in Thailand when the idea came. It was started by Nepal Rastra Bank and the banking industry’s experts. To give justice I must give credit to people like Mr. Sashin Joshi, Mr. Radesh Pant (who at that time was the President of NBA), Mr. Anil Keshari Shah, Mr. Ashok Rana and Mr. Upendra Poudel along with the Central Bank - NRB, Asian Development Bank (ADB) and the Ministry of Finance (MoF). So, NBI is the collective brainchild of all of them. Rural Microfinance Development Corporation (RMDC) also was one of the early equity contributor of NBI along with NRB and ADB.

Yes I think we have been able to fulfil the purpose of our establishment, but still we have a long way to go to truly fulfil our vision. 

What new programs are you thinking of introducing?

The services that we currently provide is called TRAK, which can be elaborated as:

T: Training     R: Research    A: Academic Programs         K: Knowledge Consulting

The major reason why we identified TRAK was because when I came on board, I wanted to keep myself on track. I didn’t want to flow on the romantic possibilities that I had seen abroad. I wanted myself to see the constraints that we have and the areas that we need to focus on right now. So, these are the four verticals that represent our four domains and within these four verticals we have a lot of ground covered.

So going forward we would like to focus less on Training now and more on Professional Certification courses, which in many country in mandatory. In almost all countries, certification is required for anyone to participate in Banking Industry or Capital Market but is not mandated in Nepal yet. So, in this scenario NBI’s focus will be more on examination and certification plus research -- that is where we want to be.

Coming back to Research, it takes resources and is time consuming too. It must be funded from some source. But the culture in Nepal is that corporate business houses don’t pay for the research, which is the sad part. So currently we’re on our way to find a solution to make research commercially viable, where people or businesses will be willing to fund the research and make use of the findings.  The reason we’re giving so much importance to research is because with Research, the process of R&D moves forward and only then new ideas and innovations happen.

Apart from training, what is NBI’s role so far in imparting financial literacy to the dispersed population of our country?

It’s actually the subject of my passion and is close to my heart. The role of NBI is not just to train the banks’ employees; our role is to cover and enlighten the entire financial market along with all the parties that are indirectly involved too. So, we also train and work with the law enforcement agencies like Central Investigation Bureau (CIB), Commission for the Investigation of Abuse of Authority (CIAA) etc. In crux, I feel that NBI’s responsibility isn’t only towards the banking personnel but the entire basket of stakeholders from customers to community to law enforcement agencies.

Similarly regarding Financial Literacy or “Bittiya Sachhartha” starts from the very beginning when you start to save. Still in Nepal a lot of transactions are happening in the informal economy and banks are still facing liquidity pressures time and again.

So we at NBI are currently working towards finding a way to connect financial literacy with entrepreneurship and to inspire people to start on their own. We are in fact taking it up a notch by introducing financial literacy training via app within two months most probably and that too for free. This will on one hand reduce the cost involved and on the other, every interested individual can access this information right from their phone.

““Pariwar farkaau abhiyan”of NBI is to convey to the world that Financial Literacy is not just about saving, but to use that saving to create something more of value. Thus, by awakening the entrepreneur zeal in people via financial literacy, we want to reunite families and make our country self-sufficient.”

Digitization has surely made our lives easier, but it has also opened a new way for ill-minded to commit crimes. We’ve heard a lot of such instances. How does NBI fit in this picture?

I agree, the crime has been there and will always be there but that doesn’t give us excuse to be careless. Similarly, just because there are risks, doesn’t mean we shouldn’t internalize the benefits of digitization and information technology. So we always need to manage our risks. 

“Being threatened by the cons of Digitization gives birth to Ostrich Syndrome, which then leads to Dynasaur Syndrome. So we have to move with time and soak ourselves in the wave of time otherwise we’ll be part of history like Kodak and Nokia.”

One other thing that comes under our Training vertical is conferences. We organize around 10 to 12 major conferences on prominent themes like Digitization, Anti Money Laundering, Risk Management, Financial Fraud, Assets-liabilities management, Human Resource etc. We actually have conference coming up on Digitization soon.

In context of Nepali market, what is the core competency of a bank that makes it stand out?

I think for a bank there is no ONE core competency. When it comes to banking industry, what we need to understand is bank has many different stakeholders, and each stakeholder has varied interest on bank. For shareholders it’s the return, for customers it’s quality service, for government it’s the compliance, for employees it’s job security and growth and so on. So focusing on only one thing might not be in the best interest of the bank.

So to list a few, the first on the list is Prudency. Prudent Banking is to work within the law and the regulations. Like I stated earlier, Banking is not a rocket science because you have a set procedure to do everything. There are the compliance needs from NRB, auditory needs and governmental rules -- and if you just follow all these rules the path is just straight ahead. The only thing banker needs to be careful of is to not lend more that you have in the deposits. If you lend higher now in anticipation of higher deposits in future that is just bad sense and that is exactly the kind of thing that gets them in trouble. Similarly, People (Human Capital) development, Corporate governance, Digitization and Code of conduct are the other things that can never be overlooked.

I along with many of my undergrad friends did our internship at commercial banks and the conclusion of all our reports had “insufficient HR”. Do you think the banks are investing enough on Human Capital?

If you look into Nepali Banking history, mid 1980s to late 1980s was the golden period and the group of people that were groomed in that period are the ones you see now leading the industry. But as the years passed by, people development started to get overshadowed by other priorities. I still meet people who have been in the industry for more than 10 years and they have not taken even one major training.

NRB now has mandated banks to invest at least 3% of their total employee expense on training and development. After the mandate was introduced, the major flaw was it said training for employee and didn’t specify employee of what level and what training. Further NRB in recent monetary policy has stated that the training should be provided within 2 years of employment with the bank.

We are now lobbying with the stake holders to further specify what kind of training to be taken within those 2 years so as to make it transparent and structured.

Once the directive is fully implemented, does NBI have capacity to provide training to such large number of professional?

Right now we are providing our assorted trainings to more than 16,000 bankers nationwide and we have the capacity to conduct nationwide exam on Professional Academic courses like JANBI to around 10,000-15,000 individuals per year and in the overall BFIs there are around 45,000 personnel. So to enhance our capacity we are going digital and taking many of our programs online or on mobile app. We’re currently working on the system development by looking at how Toefl, SAT and ielts are doing it and soon after introducing it our capacity will significantly go up. So with the right kind of technology, we can take exams of almost 1 lakh individuals in 6 months. Our partners in India do it for 4.5 lakh individuals and they are one who are helping us with this.

Similarly, we’re not just introducing it online, we’re bringing it in LMS (Learning Management Software) formats using the pracademics approach - practical academics.

“We’ll soon be releasing Proctor Online system for our courses, which is our big leap into digitization. After that our capacity will supersede the requirement”

Does NBI have any plan to tie up with international renowned training institutes?

We already have a lot of tie-up with international institutions like Frankfurt School of Management, MDI Gurgaon to name a few. Likewise we have partner everywhere from India to Hongkong to Singapore to Indonesia to Malaysia as well as in Germany. We are also associated with APABI (Asian Pacific Association of Banking Institute). In fact I was the Chairman of APABI until last year. It is a consortium of institutes like NBI from Asia Pacific. Now we are also joining European Banking Training Network as the Associate Member.

In absence of strong competitors, how any organization interested for NBI services can trust the quality of the training?

Rather than to say that there no competitors, we’ll have to see if the comparison is being done apple to apple. If we’re comparing apple to apple, yes there isn’t much competition but if we see from a wider perspective then we do have some competition to think of. Even though we’re owned by banks it isn’t mandatory for them to come to us. It is voluntary and they choose us over other training agencies only when they feel that our quality supersedes others’. 

Similarly, NBI is not owned by individuals so whatever profit NBI generates doesn’t go into the pockets of individuals but rather is reinvested in the business itself. Because of this, the goal isn’t profit. It is the quality of service we deliver that matters, so that we can build and live to the image of ourselves in the market.

Finally, Government of Nepal, Ministry of Finance vide its formal document titled ‘Bittiya Chhetra Bikas Rananiti – Financial Sector Development Strategy which was approved by the cabinet on 2073/09/22 has categorically stated that NBI must be strengthen on a regular basis and leadership to strengthen NBI has been assigned to NRB.

Could you give your valuable advice to young graduates who are willing to make career in banking industries?

The travesty of this generation, especially in middle class families, is that they aren’t taught patience. Even the smartest of the lot face huge problems when they enter into the market because they aren’t taught the reality of the real world. When it comes down to competition, only the ones with strong DNA survives. So even at this age and day we face the horrible consequences of “survival of the fittest”. So I think we need the culture of Mentorship in our country, where they start before actually starting.

Similarly the other things I believe in is that “There are no shortcuts in life. We have to grow organically.” However that doesn’t mean sheer hard work with no brains. We need hard work along with smart work to sustain and flourish in this market. For me hard work plus smart work results in efficiency. There are different interpretation of efficiency, but the way I see it efficiency means less error with higher speed. So the generation of now should aim for lesser error and higher speed.

The other thing that I spite is the culture of Copy & paste. It might have made completing assignments easier, but at the same time it has given birth to clerical and robotic minds with minimal room for creativity. If you see in Nepal, working is easy, even delivering the results is easy but the difficult thing is to go out of the league and do something different. Nepal is an emerging economy and has opportunity everywhere. The only problem is we fail to spot it. Someone might’ve said “Think outside the box” and everyone is looking for things outside of the box meanwhile leaving so many opportunities hiding in the corners inside the box. We have to seize all the opportunities inside the box, before moving out and getting bewildered.

““Think outside the box” is the rallying cry of this generation, and in the race to find opportunities outside the box we’re overlooking a lot of great opportunities hiding inside the corners of the box”