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    JP Morgan eyes collaborations in fintech space in India, says global CIO Lori Beer

    Synopsis

    Beer manages close to $14 billion of technology expenditures for the $121-billion financial services behemoth that is also the largest bank in North America by total assets.

    Lori BeerETtech
    Lori Beer, global CIO, JP Morgan
    JP Morgan is keeping a keen eye on the fintech innovation coming out of India and sees the “incredible increase of innovation that’s happening in the country” as a huge opportunity to collaborate across its entire ecosystem, Lori Beer, global chief information officer of JPMorgan Chase & Co, said.

    “We have a team that engages with the entire tech ecosystem,” Beer told ET in an exclusive interview during her visit to India earlier this month. “We also monitor the trends and see the incredible increase in innovation that is happening here,” she said about India.

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    Beer manages close to $14 billion of technology expenditures for the $121-billion financial services behemoth that is also the largest bank in North America by total assets.

    “It's a huge opportunity; with such a great talent base, our ability for the teams to get together or even innovate across that ecosystem…is something that we definitely look forward to,” she said when asked about innovations in digital public goods such as the unified payment interface (UPI) and account aggregator system among others.

    “We do a lot of work in Silicon Valley and Israel…(and are) monitoring what is happening in the (Indian) ecosystem and deciding when we want to bring in a particular company, do a proof of concept..,” Beer said.

    She also said JP Morgan’s over 19,000 tech engineers in India across its tech centres in Bengaluru, Hyderabad and Mumbai are critical to the bank's operations and innovation. India houses one-third of its total technologists globally.

    Beer, however, said the bank’s annual tech budgets for 2023 will be in a “flattish” range of $14 billion compared to last year as inflationary pressures or geopolitical issues loom but the organisation is “well-positioned to ride through economic cycles”.

    “We are seeing volatility in markets and the business environment, with some companies revising their budgets and laying off sizable portions of their staff. But as we move through the cycle, things like this will change,” she said.

    Beer said it's hard to predict what the outcome will be “because there are so many different variables, but we feel well-positioned as a company to navigate through it, and will continue to invest in our business, people, and technology”.

    US-based banks are top clients for most Indian IT companies and banking, financial services and insurance (BFSI) clients accounted for nearly 30% of Indian IT's $227-billion overall revenue in FY22, forming its largest vertical.

    While JP Morgan is looking at optimising infrastructure and using tools like increasing productivity to tide through the uncertainty, Beer said it will continue to hire and replace engineers who are leaving as part of attrition.

    She said the company is “very focused” on inventing in the blockchain space. It created a permissioned blockchain network called Liink for validating customer information and complying with anti-money laundering rules. Liink has had 35 million messages moved through the network last year. It also has JPM Coin that is for wholesale users. It is to aid a cross border payment and last-mile clearings. It is a deposit account system built on blockchain technology.

    The New York-headquartered lender said it is open to partner, acquire and invest in fintech companies as around 50% of US households want to move more from traditional banking to venture into connected commerce.

    The company had acquired Pune-based travel loyalty solutions company Tavisca in July 2021 for an undisclosed sum. The platform was integrated with JP Morgan’s portal and provides exclusive benefits for travel bookings done through the portal.

    Innovations happening in India are also being scaled globally, Beer said.

    For instance, the company’s commercial real estate management platform Story, which aims to help commercial property owners and landlords, was completely built by India-based engineers, she said. Its digital assistant was uniquely created by a team wholly in India. The digital assistant can be integrated with Zoom and Office 365.

    “In the US, one of the biggest users of cheques still is people paying rent payments… Story provides streamlined rent processing online, portfolio management, market analysis, tenant screening and of course, bank-grade security,” Beer said.

    “A few hundred applications that are directly owned out of India where the application owner sits here and their product teams are here. That is something we are continuing to look at to optimise our talent,” she said.

    Beer said all lines of business at JP Morgan are represented at its India tech centres. “We also have the teams that are building firm-wide products based in India; we built over 300 products,” she said. “Their work ranges from migrating to the public cloud to building the developer tool chain, building out core capabilities and integrating them with the big public cloud service providers, among others.”

    New-age technologies such as artificial intelligence (AI) and machine learning (ML) are other big areas of focus, she added.
    The Economic Times

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