DBS Group CEO Piyush Gupta is bullish on commercial potential in India and has utilised a "phygital" strategy to grow in the country, giving best-in-class digital capabilities to consumers complemented by a robust physical network.

The organisation sees an opportunity to broaden its business profile, which is dominated by major corporations, to include retail and SME clients, Gupta added.

"We are bullish about India as it is not just one of the fastest-growing markets in the world, but also accelerating very quickly digitally," the Meerut-born banker told PTI in an interview on Saturday.

"Our strategy in India remains to grow through a "phygital" model, offering best-in-class digital capabilities to our customers, supported by a strong physical network to help with last-mile servicing," he said.

DBS Bank India Limited (DBIL) is merging Lakshmi Vilas Bank NSE 4.79 % (LVB), which was merged with DBS on November 27, 2020 under section 45 of the Banking Regulation Act, 1949.

"Our primary focus is on integrating it with our business and in growing organically," said Gupta.

The very recent Euromoney award for DBS as the top SME/MSME supporting bank means doing more for the Indian market.

"We are happy to have been named 'World's Best SME Bank' by Euromoney for the second time. Since its inception, DBS has been supporting local businesses and broadening credit access to this segment," Gupta said.

"Our digital capabilities have helped us serve our customers seamlessly even during the pandemic in all our markets, including India. Our suite of digital offerings helped MSMEs (Micro, Small and Medium-sized Enterprises) in India meet working capital needs and operational liabilities," underlined the tech-savvy banking veteran.

DBS also helped MSMEs in India to navigate the challenging business environment by disbursing loans to the segment during the lockdown months.

"We continue to see a tremendous opportunity in India's SME and MME segments," Gupta said.

"With an expanded footprint, we are further accelerating our efforts in this segment, including making banking seamless by working with industry-level digital platforms," he said,

The RBI's recent attempt to settle international transactions in rupees could be a step toward internationalising the currency, he said. Higher demand for Indian Rupee (INR) settlements means reduced demand for FX for current account transactions, he noted.

"In the short term, the weakening of the Indian Rupee has caused some concern. However, from various lenses, the currency's fall is more contained this time around and backed by better fundamentals," Gupta, the naturalised Singaporean since 2009, pointed out.

"From a policy perspective, with the dollar appreciating in an environment of weak risk appetite and impending domestic balance of payment deficit, the evolving equilibrium will be to keep the currency on a gradually depreciating path as an adjustment mechanism without creating sharp inflationary spikes," he said.

The 62-year-old Gupta shared his insight into the current currency outlook.

"Looking further out, the currency is expected to reflect the economy's improving fundamentals, as the shift to widen the country's manufacturing base gathers momentum; incremental reforms improve the ease of doing business; and effort to hasten investments into infrastructure is demonstrated via programmes such as National Infra Pipeline, Gati NSE -1.96 % Shakti, and Asset Monetisation scheme, besides higher budgetary allocations towards capital expenditure," he said.

The RBI and the Monetary Authority of Singapore (MAS have announced a project to link their respective fast payment systems namely Unified Payments Interface (UPI) and PayNow.

DBS is closely involved in supporting the efforts of the two central banks.

Gupta said that the PayNow-UPI linkage will enable users to make instant, low-cost fund transfers directly from one bank account to another between Singapore and India.

"When implemented, fund transfers can be made from India to Singapore using mobile phone numbers, and from Singapore to India using UPI virtual payment addresses (VPA)," he said.

India is indeed a startup hotbed, Gupta said.

"We strongly believe that technological solutions and innovation play a key role in empowering the growth of startups and SMEs. It is thus important for banking partners to offer embedded solutions across ecosystems to these entities.

"At DBS, we not only work with startups but also collaborate with startup incubators in India to look at ways to support startups. Also, the bank's ability to provide API-based integration capabilities has been one of the critical success criteria in our partnership with start-ups," Gupta said.

"DBS continues to seek to better integrate our banking solutions in the existing startup ecosystem and provide enabling solutions to this segment," said the Indian Institute of Management, Ahmedabad, alumnus.

DBS created Evolution X to provide debt finance to growth-stage tech start-ups. This increases their fundraising runway with minimal dilution. DBS supports the RBI's decision to issue Payment Aggregator Licenses to Fintechs.

"As a bank operating in India, we see this as a positive move by the RBI. We continue to be closely engaged with payment companies, both to enhance and extend our capabilities as well as to provide settlement services to aggregators, leveraging our open architecture platform," he points out.

Asked if DBS and other private sector banks would participate in the multi-billion-dollar infrastructure financing in India, especially in the public-private partnership (PPP) model and or build-operate-transfer (BOT) model, he responded, "While I do not want to comment on other banks, we are generally sector agnostic in our approach and look at all aspects and the economic environment before doing so."

"As a bank, we are committed to financing the transition to a lower-carbon future and want to work alongside like-minded partners to transition industries from brown to light brown and gradually to green," he said.

"Our aim is to become net zero in the coming decades. In October 2021, DBS became the first Singapore bank to become a signatory on the United Nations-convened, industry-led Net-Zero Banking Alliance (NZBA)," he added.

As a signatory, DBS commits to transition the operational and attributable greenhouse gas (GHG) emissions from its lending and investment portfolios to align with pathways to net zero by 2050 or sooner, he said.

DBS, he said, seeks to provide sustainable financing transactions in 2021, taking the bank's cumulative efforts to 39.4 billion Singapore dollars. With this, the bank has achieved almost 80 per cent of the bank's 50 billion Singapore dollars sustainability financing target by 2024.

In addition, DBS India continues to execute the bank's strategy to transform into a more diversified franchise in India across the large-corporate, medium and small-enterprise segments as well as the growing consumer opportunity.

"We recently launched a co-branded credit card and have plans to offer the entire DBS suite of products and services to our expanded footprint as integration with LVB progresses."

"We continue to invest in the growth of the India franchise. All profits from India are ploughed back into the Indian subsidiary. Moreover, in FY22, DBS Singapore invested an additional INR 1,040 crore of capital in DBS Bank India to support growth plans in the country."

DBS has established a banking network of 500 branches across 19 states in India, covering over 200 key centres across the country. The bank has been in India for 28 years.