levels of safety, security and reliability. perhaps the most significant contribution of technology has been in attempting to bring down the cost of financial services by using economies of scale. technology has also been used in removing geographical barriers and reaching out to the unbanked – the poor are unreached but not unreachable. the use of electronic payment modes to disburse the governments social benefit transfers illustrates this point. technology should be used in such a manner that you have a diversified product range to bridge the supply gap at the same time keeping in view the customers convenience in mind. bis central bankers ’ speeches has it delivered in india in terms of reducing the costs? if not why? is the government / regulatory intervention the best way forward? what are the advantages or dangers to such an approach? channel security to compete successfully in today ’ s tough market place, financial institutions need to retain the trust of their customers – a trust which relies not only on their capacity to deliver good value services, but also on their ability to protect people, assets, premises and the highly sensitive data they hold. there is always an element of hidden fear as far as it based operations are concerned, the fear of the unknown. banks need to ensure that the best of controls and security measures are in place. customer education is the key to customer trust. are there steps taken towards customer education as far as it based service delivery channels are concerned? are these adequate? how to bridge the gap? having identified some of the gaps, let me now try and offer suggestions to bridge these gaps. it and business alignment alignment can be described as the timely and appropriate application of it in harmony with business objectives, strategies and requirements. alignment occurs when the respective strategies are interwoven in such a way that the right things are done to deliver greater value to the organisation. after all, a successful alignment is a two way relationship, a give and take between it and business. though it has the capability to reduce costs, standardise processes, the benefits of successful it - business alignment are beyond these i. e. increased efficiency of implementation & integration, reduced cycle time, increased enterprise agility and the ultimate benefit of improving the bottom line. until recently it played a docile role in business planning. it is now time for banks to move over from being merely an implementation tool to shaping business strategy. the principal difficulty is that there are few instances of business oriented it strategies as most are focussed on technology products of one shape or another

own funds. these limitations come from the bank recovery and resolution directive ( brrd ) which, in my view, is the most crucial regulatory change in europe of late, applicable to all 28 eu member countries, and will significantly contribute to breaking the bank - sovereign nexus. let me explain. the brrd implements a true paradigm change, ending the culture of bail - out and ushering in a culture of bail - in. as of 2016, in all resolution cases, the brrd will impose to the resolution authorities, a bail - in of shareholders and creditors equal to at least 8 % of total liabilities including own funds of a given bank. this amount of 8 % is very substantial if we compare it to the losses which banks faced in the recent crisis. to give you an idea : between 2008 and 2010 only one bank had losses exceeding the 8 % threshold, and the average for all other banks was slightly less than 3 %. if we look further back to the nordic financial crisis in the 90s, none of the banks affected by this crisis faced losses of more than 8 % of its total liabilities including own funds. let me first briefly describe what happens once a bank enters into resolution and how the socalled “ bail - in tool ” works under the new framework. the bail - in tool follows a sequential approach. before any resolution fund can be tapped, shareholders and creditors have to first absorb losses amounting to at least 8 % of total liabilities including own funds. although uninsured deposits from individuals and small firms come last among liabilities possibly subject to bail - in, they would be included if needed to attain the 8 % total. according to the new rules, only insured deposits are totally excluded from the bail - in tool. only after the 8 % amount is bailed - in from shareholders and creditors, can money from the resolution fund be used and for a maximum amount of 5 % of total liabilities ( including own funds ) of the bank under resolution. public resources can then be used only in case this is not enough ( which, based on past crisis experience would be exceptional ). public money, either from national governments or from direct european recapitalisation of banks, can only be used at the very end of the process which, in practice, should happen exceedingly rarely. bail - in of shareholders and creditors plus the use of the resolution fund should in most conceivable cases, be enough to ultimately cover for the losses incurred by the