6-7% of overall annual expenses are on tech related aspects, says HDFC Bank

Country's largest private sector lender HDFC Bank spends 6-7 per cent of its overall expenses on technology-related aspects every year, a senior official said on Tuesday. Parag Rao, HDFC Bank head for payments and consumer finance, said the bank has been investing in digital capabilities amid "cloudification", where tasks are moved to the cloud.The comments come amid greater regulatory scrutiny on the technology front. "We spend about 6-7 per cent of our overall expenses on technology," he told reporters here on the sidelines of a digital credit card launch of the bank.He explained that the spends go up initially when the capital expenditure is higher and then go down gradually. About 50 per cent of the spend is on employees, while the rest is on remaining aspects like hardware, software and keeping the network operational, he said. It can be noted that HDFC Bank was the first major lender to be slapped with business restrictions like a pause on issuing new credit cards and also launching new online products over two years ago. It had to work around on the systems before the restrictions were completely lifted. Asked about the Reserve Bank's recent move to allow customers to choose between card networks, Rao said he does not see any business any impact from it.