Latest news with #KotakMahindraLifeInsurance
Economic Times
6 days ago
- Business
- Economic Times
India's bond market signals extended rate pause despite low inflation
Bond dealers said the spread between the 10-year yield and the repo rate was lower in early 2025 because RBI's open market operations skewed the demand-supply balance in favour of bonds as the central bank absorbed much of the supply. India's bond market indicates a likely pause in the RBI's rate-easing cycle, despite retail inflation hitting an eight-year low. A surge in yields has significantly widened the spread between 10-year bonds and the repo rate, signaling market expectations of sustained policy hold. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: India' bond market is signalling a long pause in the central bank's rate-easing cycle despite the retail inflation gauge falling to an eight-year low of 1.55%, way below Mint Road's ordinary legal mandate of 4%. A spike in yields has widened the spread between 10-year bonds and the repo rate to almost one percentage point-the most in 2025. "The widening of the spread between the 10-year yield and repo rate is an indication that the market is pricing in an extended policy pause," said Churchil Bhatt, executive vice-president, investment, Kotak Mahindra Life Insurance. "After the last monetary policy , market participants believe that the bar for further rate cuts is fairly high. Traders have given up hopes of an October rate cut."The spread widened to 99 basis points on Tuesday, compared with around 20 bps just before the Reserve Bank of India (RBI) started the rate-cutting cycle in February under its new governor Sanjay Malhotra. One basis point is a hundredth of a percentage traders now expect 5.5% as the terminal repo rate, against 5% expected before last week's policy. The central bank has eased rates by a cumulative one percentage point this as measured by the consumer price index (CPI) fell to 1.55% in July, below the lower bound of the central bank's target range of 2-6% with 4% as the mid-point. Economists had anticipated a CPI reading of below 2%.However, despite the low CPI print, the bond markets are not pricing in a rate cut in October because the central bank's projections show inflation would climb toward the end of FY26. The yield on the benchmark 10-year paper, which serves as the basis for pricing of corporate loans, closed on Tuesday at 6.49%, the highest since early central bank kept rates on hold and continued with a 'neutral' monetary policy stance last week. While this was expected, the absence of dovish stance along with RBI's inflation forecast of 4.9%-higher than its medium-term target-for the first quarter of next fiscal year dampened hopes of rate cut in October unless there is a sharp growth shock-whether domestic or external. Last week, the RBI retained the growth projection at 6.5%. "The combined fear of the rate cut cycle ending and a higher fiscal deficit-caused by weaker revenue and easing measures to support sectors hit by tariffs-has soured sentiment for the market," said Abhishek Upadhay, economist at ICICI Securities Primary dealers said the spread between the 10-year yield and the repo rate was lower in early 2025 because RBI's open market operations skewed the demand-supply balance in favour of bonds as the central bank absorbed much of the supply. The current widening of the spread should also, therefore, be viewed in the context of the absence of this demand.
Mint
29-05-2025
- Automotive
- Mint
From Transactions to Trust: The Tech-Driven Transformation at Kotak Life
As digital transformation sweeps across industries, the insurance sector is undergoing a quiet but significant evolution. What was once a transactional relationship is now being reshaped into a Trust-based, tech-enabled experience, especially in a country as diverse as India. In this exclusive conversation, Kirti Patil, Joint President and Chief Technology Officer at Kotak Mahindra Life Insurance, shares how the company's digital platform, Optimus, is putting simplicity, empathy, and intelligence at the heart of its customer and advisor journeys. Building for a Digitally Diverse India Q: Kirti, with digital access now expanding beyond metros, how is Optimus supporting this wider transformation in insurance experiences? Kirti Patil: When we conceptualized Optimus, we knew the change had to be structural. We named it Project Parivartan for a reason—it was about rethinking the customer journey, modernizing digital engineering, and changing how technology is deployed in the field. Whether it's streamlining paperwork or empowering field advisors, Optimus was built to work in real-world India—from urban homes to rural schools. Q: What defines a frictionless insurance experience, and how did this guide the design of Optimus? Kirti: Four things: ease, convenience, speed, and personalization. We created an intuitive UI that's usable even for those with low digital literacy. The platform integrates with Aadhaar, CKYC, and payment gateways—yet still allows for manual uploads if needed. The process is designed to take under 15 minutes, and it adapts dynamically to the user, whether a customer or advisor. Q: How have you addressed the challenges of India's Tier 2 and Tier 3 markets, especially when it comes to connectivity and digital familiarity? Kirti: Our agents often work in low-bandwidth zones, sometimes at a customer's home with patchy internet. Optimus is mobile-first and optimized for low-connectivity areas. We use SMS-based OTPs for verification and include prompts at every step, so even new users don't feel lost. It's about tech that adapts to people, not the other way around. Q: In a hybrid distribution environment, how do you ensure consistency of experience across digital and human channels? Kirti: Whether it's a direct customer, an aggregator, or an advisor, everyone interacts with a unified interface. We've reused components and built standardized APIs so the experience stays consistent. Disclosures, illustrations, and documents are displayed the same way, regardless of channel. That consistency builds digital trust—and that's non-negotiable. Q: How is Optimus enhancing productivity for Kotak Life's sales teams and partners? Kirti: Optimus mirrors the sales process—need analysis, quotes, and proposals—all in one seamless flow. It reduces back-and-forth with the customer and enables multiple actions in parallel, like KYC and payments. The best part? It's so intuitive, new advisors can use it without training. That's real enablement. Q: How do you keep evolving Optimus based on real-world feedback? Kirti: When we started, we co-created the platform with agents through focused user group discussions. Today, we have monthly feedback cycles built into the tech team's KRAs. Teams visit branches, shadow users, and integrate feedback into the product backlog. The field shapes the future of Optimus. Q: The front end is simple, but what powers Optimus behind the scenes? Kirti: Optimus is cloud-native, built on microservices and agile principles. It's scalable, resilient, and modular. We've integrated a form framework and a journey orchestrator, so changes can be made without backend rework. With CI/CD pipelines, we roll out features quickly and securely. Our goal: let the tech fade, and the experience shine. The Road Ahead: AI, Voice & Vernacular Q: With AI and voice tech rising fast, how are you preparing Optimus to stay ahead? Kirti: We're working on predictive AI for lapses and persistency. We already use AI to extract data from documents. Voice-assisted journeys and vernacular language interfaces are next. We've built video verification in regional languages—and soon, advisors will be able to run the full journey in their language of choice. This is especially important for Bharat. Q: As CTO, how do you define innovation in platforms like Optimus? Kirti: Innovation, for me, is about simplicity—for both the user and the builder. It's about utility—solutions must be genuinely useful. And above all, it's about empathy. If your technology lacks empathy, you lose both relevance and trust. Q: Finally, what's your long-term vision for Optimus—and what should users feel when they engage with it? Kirti: I often say—today's luxury cars have more electronics than a computer, but when we drive them, we only remember the experience. That's what I want for Optimus. Let the tech fade into the background. What should remain is clarity, confidence, and care. ConclusionAs Kotak Mahindra Life Insurance embraces the future of digital insurance, Optimus stands as a testament to the power of human-led technology—one that's designed not just to perform, but to connect, adapt, and empower. In Kirti Patil's words, 'We're not just building for today—we're building for trust.' Note to the Reader: This article is a promotional feature and does not have journalistic/editorial involvement of Mint. Mint does not endorse/subscribe to the content(s) of the article/advertisement.
