JPMorgan is not your typical investment bank. It is currently setting itself apart by adopting an AI-first strategy. Most recently, the US bank announced that it is launching a generative AI tool for its employees – an in-house version of OpenAI’s ChatGPT that can effectively perform tasks typically done by research analysts.

Named the LLM Suite, the new large language model platform will be available to employees in JPMorgan’s asset and wealth management division. It supports tasks like writing, idea generation, and document summarisation making use of third-party models.

Earlier this year, JPMorgan began rolling out the LLM Suite to select areas within the bank, reaching approximately 50,000 employees, or about 15% of its workforce.

The bank developed its own proprietary LLM platform internally because its employees are prohibited from using consumer AI chatbots such as Anthropic’s Claude, OpenAI’s ChatGPT, or Google’s Gemini for work. Strict regulations in the financial sector require that client data remains within secure, in-house servers.

With numerous open-source models available, such as Llama 3.1 and Mistral Large 2, which rival OpenAI’s GPT-4o, financial institutions now have the flexibility to develop their own AI models rather than relying solely on OpenAI’s APIs.

“AI is real. We already have thousands of people working on it, including top scientists around the world like Manuela Veloso from Carnegie Mellon Machine Learning,” said JP Morgan chief Jamie Dimon, adding that AI is already a living, breathing entity.

“It’s going to change, there will be all types of different models, tools, and technologies. But for us, the way to think about it is in every single process—errors, trading, hedging, research, every app, every database—you’re going to be applying AI,” he predicted. “It might be as a copilot, or it might be to replace humans.”

He further said that they have already integrated generative AI into their various services, primarily for idea generation and note taking. He further explained that while taking notes, the AI provides additional insights or highlights important points. For example, it can flag potential client interests or identify recurring issues related to errors or customer service.

Dimon is convinced that AI might replace some jobs as well. “What AI’s gonna do is know more about you, learn more about you, look at patterns, and look at successful things in the past. AI will be a huge aid to things like that,” he said.

JPMorgan’s Generative AI Offerings

One of the standout offerings from JPMorgan is Quest IndexGPT, a tool powered by OpenAI’s GPT-4 model for thematic investing. IndexGPT analyses news articles and generates keyword-driven investment themes, facilitating more informed decision-making for clients.

“In the past, the process of finding stock portfolios that track themes such as cloud computing or cybersecurity was complicated. Now, we use AI to systematically generate the keywords that help us identify the relevant stocks,” explained Deepak Maharaj,  who heads the Equities Strategic Indices team at JPMorgan. 

“With GPT-4, the keyword generation is superior to older models, and therefore our clients benefit from a potentially more accurate representation of the theme,” he added.

In 2023, JPMorgan Chase developed an AI tool to help it analyse United States Federal Reserve statements. This was done to determine whether trading signals could be detected in the speeches and statements. With the tool, analysts could observe policy shifts and generate signals for trading.

In-House Research

JPMorgan’s AI research is advancing rapidly alongside its use of GPT-4. The firm now employs over 2,000 AI and machine learning experts. AI is used in over 400 areas within the bank, including marketing, fraud detection, and risk management. Dimon said that, now, generative AI is being explored for customer service, operations, and software engineering.

According to AIM Research, JPMorgan is aggressively hiring in AI, with over 75 open positions in the field. Salaries are competitive, with roles like applied AI/ML senior associate offering between $129,250 and $195,000 annually, depending on location and experience.

Earlier this year, JPMorgan’s AI team published a paper on DocGraphLM, a new tool for document analysis. DocGraphLM enhances information extraction (IE) and question-answering (QA) for complex documents by integrating pre-trained language models with graph semantics. It features a joint encoder architecture and an innovative link prediction method for reconstructing document graphs.

Building on this, the bank also introduced DocLLM, a generative language model designed for multimodal document understanding. DocLLM stands out as a lightweight extension to LLMs for analysing enterprise documents, spanning forms, invoices, reports, and contracts that carry intricate semantics at the intersection of textual and spatial modalities.

Furthermore, JPMorgan has launched FlowMind, a system that uses LLMs to automate workflow generation. 

What Are the Others Doing? 

Goldman Sachs plans to complete the rollout of its initial generative AI tool for code generation to thousands of developers across the company. Goldman Sachs’ generative AI platform, the GS AI Platform, evolved from an existing machine-learning system and serves as the central hub for all generative AI initiatives at the company. 

Goldman has partnered with Microsoft, an OpenAI-backer, to utilise GPT-3.5 and GPT-4 models, and with Google for its Gemini model. The platform also incorporates open-source models such as Meta’s Llama. 

Meanwhile, Citigroup provided its 40,000 coders with access to generative AI. For example, when federal regulators released 1,089 pages of new capital rules for the US banking sector, Citigroup used generative AI to meticulously review the document.

Wells Fargo has integrated generative AI into its virtual assistant, called ‘Fargo,’ to enhance customer interactions. The AI-driven assistant can answer queries, provide account information, and assist with transactions in a conversational manner. The app, built on Google Dialogflow and utilising Google’s PaLM 2 LLM, was launched only recently.

Morgan Stanley also recently launched its second generative AI application for financial advisers, opting for in-house solutions instead of pre-built tools from AI startups. The new application, AI @ Morgan Stanley Debrief, is designed to summarise video meetings and create follow-up email drafts.

This addition comes after the September 2023 debut of its AI knowledge assistant tool. Developed in partnership with OpenAI, it aids advisers in swiftly locating information from Morgan Stanley’s research.

Finally, Bloomberg recently introduced BloombergGPT, a model trained on over 50 billion parameters. It assists users in interpreting financial documents, reports, and invoices.

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Apple recently announced its plans to add more health detection features in their next series of watches, particularly hypertension and apnea among others. 

However, the company’s push towards healthcare dates to 2011 when Apple worked with Avolonte, a health-care company, on a secret project dubbed E5 that aimed at creating non-invasive blood glucose monitoring. They even wanted to start Apple Clinics. 

All these, probably to address the broken healthcare system in the US. 

Interestingly, Apple isn’t the only tech company that’s tried to get into the healthcare sector. Being considered a broken industry by many tech players, healthcare is also seen as a prospective revenue stream. Microsoft, Google, Amazon, and Oracle, have all entered the health space. 

Late last year, Microsoft started utilising GPT-3 to find solutions and impact across the healthcare sector, including consultation and treatment recommendations. Now, they are busy experimenting with GPT-4. 

Google, on the other hand, through their large language model Med-PaLM-2 is looking at assisting with medical questions in an accurate and safe manner. 

Recently, Oracle unveiled a number of innovative solutions to enhance patient care, clinical expertise and improve the healthcare system as a whole. 

Here’s a quick glimpse into what big tech are upto in the healthcare industry: 

An “Apple” A Day, Keeps Doctor Away Smiling 

“If you zoom out into the future and you look back and you ask the question – what was Apple’s greatest contribution to mankind? It will be about health.” In a 2019 CNBC interview, CEO Tim Cook, spoke about ‘democratising’ healthcare and their aim to empower individuals in managing their health by leveraging existing institutional knowledge, and highlighting their early stages in this endeavour. 

While Apple had been aggressively working on integrating health monitoring and disease prevention into its devices, Bloomberg reported that the company’s strategy faced setbacks owing to philosophical differences, conservative culture and technological constraints.

Investing time and millions of dollars, researchers at Avalonte worked on using short-wave infrared absorption spectroscopy as a method for non-invasive glucose measurement, however it did not materialise. This led to the company releasing the Apple watch as a niche accessory to complement an iPhone, and not as a health device, as per original vision. 

Healthcare struggles 

In a WSJ Podcast, health technology reporter, Rolfe Winkler, called healthcare as technology’s “white whale.” Being a huge, attractive market for disruption, the field is considered complex- “It’s not like you can write software that just solves problems faced by the human body and all the regulations, payer schemes, and just junk that goes with healthcare.” Apple, along with others, experimented in this direction. 

In 2021, Haven healthcare, a joint venture between Apple, JP Morgan and Berkshire Hathaway, was dismantled in less than three years of its launch. The collaboration was set up with an aim to lower costs and improve outcomes in employee healthcare. However, the venture failed owing to inadequate market power, existing US healthcare system and the pandemic. The failure marked the difficulty of altering American healthcare, a webbed framework of doctors, insurers, drugmakers and middlemen that costs the country $3.5 trillion annually. 

Apple even wanted to experiment with a primary care service for its employees by linking data from their devices with clinical care. However, the project did not pick up as employees questioned the integrity of data collected through the service. 

Will Not Give Up

Despite initial setbacks on their health devices, and failed plans of health clinics, Apple is relentlessly working towards adding additional health features on its devices. The company. It is said that next year, Apple watches will be able to detect hypertension and sleep apnea. Furthermore, Apple is also working on bringing hearing-aid capabilities to its AirPods. 

The company is also aggressively working on wellness-related features to address mental well-being of users. Earlier this year, it was reported that Apple is working on an AI-powered health coaching service for tracking emotions. Furthermore, there are plans to make Vision Pro headsets as a health and fitness device too. 

With big tech companies aggressively entering the healthcare sector, latest being OpenAI that partnered with Whoop to power their smartwatches, Apple seems to be way ahead with a solid roadmap and vision for the health domain. The company is also in talks to get regulatory approvals that can allow Apple to interpret data for its users. 

Interestingly, out of the big tech companies that are actively involved in the space, Apple is the only company that has niche hardware health products for direct users. Other tech giants are offering solutions that mostly aid hospitals and clinics in offering better solutions for patients. Apple’s involvement in health results in consumer products that are accessible for everybody – a truly unique approach in healthcare. 

Going by its ambitious plan, it is likely that 2024 might be Apple’s year for further health tech breakthroughs. Who knows owning Apple products might just save your life someday. 

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JPMorgan Chase announced a hiring spree to hire 5,000 technologists in India in 2022 as they step up their operations. 

A US-based financial services company, JPMorgan Chase is one of the largest employers in India’s foreign banking arena. The company hired 4,000 employees in 2021.

JPMorgan is focusing on hiring technologists from Hyderabad, Bengaluru and Mumbai. The company is hiring digital operators from the field of big data and robotics, which are emerging as the future of banking operations. The company is increasingly investing and building on complex technology roles in AI, analytics and blockchain.

Assigning global roles encompassing product, design, and technology partners to India, the hiring is for individuals who work in AI, machine learning, cybersecurity, cloud computing and data engineering. 

Ravi Pasupuleti, Managing Director, Mumbai Tech Center Lead said, “Our India employees are being aligned to global product roles and are driving initiatives globally.”

One third of the bank’s employees are based in the three cities and rising in importance on the global map acting as innovation hubs linking multiple lines of functions and business across the world.

JPMorgan Chase has been focusing on hiring computer science majors but also hiring from ancillary streams through ‘Tech Connect’, one of their hiring initiatives. The hiring is directly at mid- and senior levels, leveling up to managing directors with a dedicated training programme.

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Sydney-headquartered global brokerage firm Macquarie, in its latest report, said it’s different this time for the IT companies, compared to previous recessions. The firm believes the India tier-I is an attractive territory.

Macquarie has upgraded Wipro to ‘outperform’ from ‘neutral’ and said that TCS and HCL Technologies would remain their top picks. However, given the sharper correction in HCL Technologies and the improved outlook for IMS, the brokerage has changed the pecking order to HCLT>TCS>Infosys>Wipro>TechM from TCS>HCLT>Infosys> Tech Mahindra>Wipro. 

“We revised earnings across the board with updates following FY22 Q4 results and updated USD-INR assumptions at 77.6,” said Ravi Menon, an analyst at Macquarie Capital. 

This time it is different. But, why? 

“When India Tier-1 were much smaller players and acting as providers of skills and not solutions, the impact on them was more severe,” said Macquarie. 

Post-global financial crisis, India Tier-I grew to became strategic partners and are not likely to be as impacted by minor cuts in IT budgets that are likely to fall first on smaller firms that are staff augmentation providers. 

Further, Macquarie said they might also be beneficiaries of vendor consolidation deals. “We do not expect ‘knee-jerk reactions’ from any firms as the baseline expectation is that if there is a US recession, it will be mild,” said the Macquarie report. 

Macquarie believes even firms that did phenomenally well during the pandemic, and are facing revenue and margin headwinds now, are not expected to slash technology budgets. However, they might reduce travel costs, limit the extensions granted to highly experimental projects, and are likely to shrink budgets by ~1 per cent. 

JP Morgan, Nomura forecasts

The optimistic forecasting from Macquarie comes after recent downgrades of frontline IT stocks from JP Morgan. It downgraded TCS, HCL, Wipro and L&T to ‘underweight’ from ‘neutral’ and slashed its target price by 15-21 per cent over margin, revenue concerns, surging inflation, and supply chain issues in the wake of the Russia-Ukraine war. 

Here’s a quick overview of the Indian IT sector by Macquarie and JP Morgan:

Meanwhile, Japan-headquartered global brokerage firm Nomura has also downgraded several frontline IT companies, including TCS, L&T, Wipro, HCL Technology, Infosys, in the face of decline in revenue. 

Worries over demand overdone 

Macquarie said that, unlike in the 2000s, Indian Tier-I IT services firms are strategic partners and not glorified staffing providers who will be the first to bear the brunt of cuts. 

In other words, the revenue is not capped the same way as in the case of tech vendors/staffing providers. Meaning, if you are a staffing provider, you have flat fees, But, if you are a strategic partner, you get a percentage of the revenue. So, if the organisation grows, your revenue also grows.

Macquarie said BFSI is the biggest vertical for most Indian Tier-1, and demand seems resilient, citing JP Morgan that has upped CY2022 tech spending by 12.8 percent. “We think firms that choose to cut back will be risking long-term competitiveness,” said Macquarie. 

Macquarie said that technology investments are like a nuclear arms race, and where one bank leads, others must follow. 

As per Macquarie’s Asia technology team, the server demand is not slowing. It said that ‘server/networking tracker: remains positive on datacenter server growth’ as of May 2022. 

The firm’s channel checks indicate no change in demand, barring slight declines in specific segments. The company said no material changes were done to the demand environment for India Tier-I and any cost savings attempts are likely to lead to vendor consolidation, favouring larger firms. 

But how did they come to this conclusion? Typically, the brokerage goes to different users to check if the IT companies’ demand has changed. If the users (say a production or manufacturing company) say that they have stopped using them, they will reduce volume.

Macquarie said even retailers who have reported slowing sales or are warning of margin pressures continue to spend higher on CAPEX. 

For example, Target has raised its CAPEX guidance for CY22 to the higher end of its earlier guidance of USD 4-5 billion even though only 55 percent of its sales come offline now and online continues to grow faster than offline. Meanwhile, other retailers such as Macy’s are seeing improved results temporarily as customers switch to higher prices and higher-margin products such as office wear and clothes for special occasions. 

Menon said the drivers for digital transformation are linked to business strategy, and the technology changes are expected to deliver either higher revenue or lower costs or both. He said there is a strong business case to continue spending, as years of investments to stay ahead of peers can be undone by a short-sighted cost-cutting measure. 

Macquarie said the demand they saw over CY21 is not just pent-up demand but an indication of the biggest technology refresh in Enterprise technology landscapes since the adoption of  web technologies and ERP in the 2000s. 

In other words, the 2021 higher P/E and IT valuations were not because of the 2020s lows. Instead, it was due to higher adoption. Life-time-value (LTV) of SaaS and tech in a B2B setting is at least ten years, and there is no reason for the industry to worry now.

Menon said while there is some correlation between S&P 500 revenues and tech spending, people should not expect a like-to-like move as this ignores cost deflation in hardware and cost deflation in the 2000s from embracing offshore execution. 

Opportunities in the time of crisis 

Macquarie believes that just because the economy does badly doesn’t mean the recession seeps into IT. On the bright side, the demand is likely to continue for IT with digital transformation happening across industries. 

However, Macquarie said it expects minor pockets of slight spending cuts (home improvement). Citing Broadcom VMware, it anticipated additional opportunities, such as increased M&A, alongside industries bouncing back and increasing spending, particularly in travel and hospitality, energy, etc.

Impact of depreciating INR 

As per ET, the Indian Rupee has depreciated 3.5 percent against the USD in 2022. Moreover, the Rupee has depreciated by over 1.2 percent in the last few months alone. In contrast, in 2017, the Rupee stood at INR 64.60 against the dollar; today (at the time of writing), it was about INR 77.63. 

Macquarie said unlike the INR depreciation in 2014/15, INR depreciation benefits will be partly retained by vendors this time, given this is still a supply-constrained market and likely to remain so.

The brokerage said it expects attrition to be moderate, given large fresh graduate hiring in FY22 across all firms. It projects gross margins to start expanding in FY22 Q3, as FY23 fresh graduate hiring and wage hike impacts ease and utilisation improvement, and pyramid levers (i.e. fresh addition) play out. 

Is the IT sector recession-proof? 

Macquarie said the IT spending seems recession-proof, with US computer-related employment down just 0.3 percent over 2008-09 and 0.8 percent over 2009-10. For instance, the US employment in computer-related occupations has increased from 2.03 million jobs in 1997 to 3.54 million jobs in 2007, 4.56 million jobs in 2017, and 5.07 million jobs in May 2021. 

US employment in computer-related occupations excluding computer science teachers (Source: Macquarie Research)

Compared to the rest of the world, the Indian IT sector has always had higher resistance to recession and survived the 2008 financial crisis, the dot-com bubble, and the pandemic unscathed. The majority of the leading IT companies grew significantly during these critical times thanks to their strong fundamentals and surplus cash reserves. For instance, Infosys clocked 19.7 percent revenue growth during the pandemic (2021-22).

Even if the US recession hits the Indian shores, this will work in the IT sector’s favour because most of them are likely to redirect their outsourcing work/projects to countries like India, the Philippines, because of the cost benefits and tech talent available in these countries.

A study conducted by Korn Ferry showed India is projected to have a skilled labour surplus of 245 million workers by 2030. The firm said, while the world would face a tech talent crunch, India is expected to lead with over one million surplus skilled tech workers. 

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Earlier this week, the global brokerage firm JP Morgan ‘downgraded’ the Indian information technology (IT) sector over margin and revenue concerns, alongside surging inflation and supply chain issues in the Russia-Ukraine tussle. 

The global brokerage firm has downgraded Tata Consultancy Services, HCL Technology, Wipro, and L&T Technology to ‘underweight’ from ‘neutral’ and slashed its target price by 15-21 per cent, but maintained an ‘overweight’ rating on Infosys, Mphasis, and Tech Mahindra, with reduced target prices. 

Why, though?

The firm said that the Indian IT growth was accelerating till the third quarter of 2022 and has begun to slow down from the fourth quarter, which is likely to worsen into FY23 due to the high attrition rate and talent management that has pushed up costs of hiring and retaining employees. 

JP Morgan’s Ankur Rudra and Bhavik Mehta said that the rising margin headwinds in the near term and revenue headwinds in the medium term from potential macro slowdown would mean that the sector’s earnings upgrade cycle is behind. 

Goldman Sachs also warned that there was a 30 per cent chance the US economy would tip into recession over the next two years due to aggressive interest rate hikes by the US federal reserve. Other firms such as Wells Fargo and Morgan Stanley believe a recession in the US is around the corner as the US Fed shows no signs of easing its fight against high inflation. 

Meanwhile, Kotak Equities said ‘what is priced into stock’ is a risk to margins. What is not priced in is ‘economic recession.’

The company has trimmed its fair value targets for nine IT stocks under its coverage by 2-14 per cent, assuming a moderate slowdown in demand for IT services. 

S&P Global rating slashed India’s growth forecast to 7.3 per cent from 7.8 per cent for FY23 on rising inflationary pressure and the prolonged Russia-Ukraine war.

Wait, a twist 

Interestingly, the US market contributes 40-78 per cent of revenues for Indian IT companies. This includes TCS, Wipro, HCL Technologies, Infosys, and Tech Mahindra, having more than 50 per cent exposure. 

On the bright side, this can also be a blessing in disguise for Indian IT companies, as the majority of them are likely to cut costs abroad and outsource work to countries like India, the Philippines and others because of the cost benefits/advantage. In addition, some experts said that thanks to the recession and rising inflation, companies can now focus on offering better services to their customers, as the innovations and other R&D related work takes a backseat. 

Is the Indian IT sector recession-proof? 

The Indian IT sector has always had higher resistance than the rest of the world. This includes the 2008 financial crisis, the dot-com bubble, the pandemic, and others. Moreover, the fundamentals of some of these IT companies are at an all-time high. 

Here’s a quick overview of the top IT firms in India, showcasing the P/E ratio and sales growth in the last five years. 

Kiran Kumar S said during 2021-22, Infosys clocked 19.7 per cent revenue growth – it is the fastest in 11 years. “Many more companies performed very well, the same way,” he added, saying that the Indian IT industry saved the economy during a Covid downturn. 

If not the IT sector, then what are the alternatives?  

While JP Morgan has ‘downgraded’ the Indian sector to ‘underweight’ and slashed the target price of multiples by 10-20 per cent, the question is, which are the alternate sectors that are bound to generate revenues amid the recession? 

The JP Morgan report stated the bottom-up outlook remains positive from most services, software, and SaaS names YTD. The tech spending cycle remains buoyant structurally. “We feel there are more downside risks to current earnings assumptions,” it added. 

The post Oh boy, is JP Morgan wrong? appeared first on AIM.

JP Morgan recently announced that this year the company is looking to hire around 4000 experienced techies in India. At present, the company has more than 35,000 employees in technology and operations across three different cities in India and more than 250,000 employees worldwide.

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According to sources, Gaurav Ahluwalia, head of HR India corporate centres in JP Morgan, said, “Technology is critical to our client success and business strategy. We are always looking to grow our talent to support this, including in areas such as cloud, big data, AI, machine learning, digital platforms and cybersecurity.

Last month, the company announced to provide $2 million to support Coronavirus relief efforts in India, including to the US-India Friendship Alliance, an affiliate of the US-India Strategic Partnership Forum, and local nonprofits helping those most impacted by the virus. 

 The contributions will support the public health system by helping to improve the capacity and supply chains of small hospitals, which will enable them to provide treatment for greater numbers of affected patients. Other contributions will go toward providing food and essential items to low-income communities across India.

In order to advance the racial equity, the firm has also committed $30 billion over the next five years to drive an inclusive recovery, support employees and break down barriers of systemic racism.

The post JP Morgan To Hire 4000 In India Mostly In AI & ML appeared first on AIM.

When an employee is hired, he or she is given access to certain resources of the organisation through a personalised account created by the IT department. As part of identity access management (IAM), the account needs to be updated or audited with promotions, transfers or departure of the employee, which if not done could lead to a major source of a breach.

Employees are often found to be using the same passwords that become a loophole in the system, and such breaches could turn an organisation into dust within no time, and the situation could turn ugly with lawsuits being filed by shareholders.

In the past, a number of cases have been witnessed such as the attack on JP Morgan in the year 2014, which led to a theft of data on 76 million households and 7 million small businesses was due to a compromised employee account. That’s not all as a report by Forcepoint claims that employees in Europe are willing to provide the password to their account to outside for an amount of 200 euros. Moving forward, another case to be highlighted is that of a departing scientist from DuPoint in 2005, who downloaded more than 22,000 files from the data library that culminated to $400 million of trade secrets.

Due to these reasons, user access provisions must follow certain practices. The idea cannot be limited to simply restricting user access but also administering user accounts, access controls, and keeping a watch on inappropriate behaviour by an employee in a better manner.

In this next section, we discuss a few guidelines to ensure safer organisational practices.

Assess Identity Management Program

To begin with, an organisation can go through the quality of the identity management program currently operates in the organisation and try to figure out if the IT team is fully aware of what user provision is. On the technological front, an organisation must evaluate the security and stability of the management software at the place. 

It is important to know whether the employees from the IT department are capable of handling the software and with pace. For example, when an employee leaves, the team must be able to remove them from the access list immediately. Also, it is imperative for an organisation to know the kind of access the IT team has with respect to the organisation’s data since their accounts are also a part of the identity management program.

Automated User Provisioning

Automating the user provisioning takes the responsibility off the shoulder of the IT team by removing delays and difficulties, which are caused by manual operators. User provisioning consists of six components such as managing access control policies, interconnections with IT systems, guided sign-offs, delegated administration, password management and auditing. 

Organisations can automate these processes to ensure that employees only have access to the information they need to complete their job. Furthermore, their access capacity changes with a change in the job role. In order to reach automation, an organisation’s personal system should be linked to the user account system throughout the IAM software. Once linked, the software automatically detects the changes taking place in the HR data and take the necessary steps to stay aligned with the norms of user provision.

Understanding Business

To implement user provisioning, a good amount of time is required along with the need to pull resources from other operations. Also, with the automation of user provisioning coming into play, companies need to understand a business case in order to identify the return of investment. The reason this pointer becomes particularly important because automation will not require too many hands and head in the IT team and thus, will save the desk cost. 

Furthermore, when the right information is being displayed to the right person, the productivity increases compared to a system where an employee has to filter the available data to finish off a task. 

Continuous Monitoring

Implementation of the user provisioning system is not enough to create a controlled and secure environment. An organisation should be able to monitor the user provisioning system on a quarterly or annual basis. The organisation should calculate the number of user provisioning requests made in an hour or a couple of hours, depending on the organisation’s size. 

It should be able to keep track of the number provisioning request handled by the desk to zero-in the timeframe, which should minimise with time. The system should be seamlessly integrated and work hasslefree. In a scenario where that is not the case, employees could face trouble and the time required to complete a task could increase.

Audit All Action

All the access actions, even by the IT team should be audited. Putting restrictions is likely to bring down malicious actions by insiders because employees who are aware of the fact that their actions are being monitored are less likely to take a harmful step against the organisation. 

Furthermore, big organisations often allow remote access to certain employees and clients, which could lead to cybersecurity and information security attacks. Thus, it is advisable to narrow down and control the remote access facilities. 

Outlook 

The number of information breaches taking place these days and mostly from inside the organisations, it is imperative to install an efficient user provisioning system, which will take care of cyber and information security along with streamlining access provisioning lifecycles. 

Furthermore, replacing time-consuming ad-hoc process with an automated system reduces human error and reduces threats an organisation is likely to face. User provisioning system should be a key area to focus on for organisations since it is the first step to ensure an adequate SecOps environment.

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Seven Indian banks have reportedly joined JP Morgan blockchain platform known as Interbank Information Network (IIN) in a move to make global exchange of financial information faster and secure. The banks include YES Bank, ICICI, Union Bank of India, Federal Bank of India and Canara Bank. At a time when financial blockchain ecosystem is undergoing heavy scrutiny of the Indian government, this move is a milestone. This is even more true because JP Morgan’s blockchain Interbank Information Network (IIN) may use a native cryptocurrency JPM coin to help move funds and provide liquidity. 

JP Morgan’s IIN aims to make global banking faster and more efficient by exchanging and verifying transactional data in real-time. IIN is based on Quorum- a permissioned distributed ledger whose code was forked from the Ethereum public blockchain. But unlike the Ethereum network, Quorum is not decentralised and is controlled by JP Morgan. The network is very similar to Facebook’s Libra project which unlike JP Morgan’s project faced huge backlash from regulators due to data privacy concerns. After the blockchain pilot in 2017, JP Morgan’s Quorum has enjoyed an extensive network of participant banks- standing at about 350 global banks, which collectively own trillions of dollars in assets.

Apart from India, JPMorgan’s blockchain payments platform saw the onboarding of one of Singapore’s largest bank OCBC. Apart from Quorum, other blockchain companies like Google backed Ripple and IBM backed Stellar have launched similar networks to expedite the flow of financial data.

How Indian Banks Can Benefit From This JP Morgan Blockchain

Apart from being fast, JP Morgan’s IIN blockchain network aims to keep data secure and free from data tampering. This is crucial for banking networks so fraudulent loans, cash flows, diversion of funds do not go unrecorded. Experts have said in the past that India’s PNB fraud case had not happened if global financial messaging network used blockchain based consensus systems. The initial application on IIN wants to create an infrastructure for financial institutions to exchange data on global financial compliance and AML purposes, the bank said.

According to JP Morgan, IIN’s vision is to get rid of pain points friction points in global remittance systems and build services and financial products, the bank told. “We look to address the challenges banks face in cross-border payments pertaining to friction points caused by multiple hops through the payment chain when further information is required,” said Madhav Kalyan, CEO, JPMorgan Chase Bank, India in a media statement.

Quorum Blockchain : What About Financial Data Privacy

When it comes to financial data, user data privacy is paramount. This is one area where Facebook’s Libra blockchain protocol failed to convince critics. To help with the issue of user privacy, the IIN network implements a layer zero-knowledge proofs (ZKPs) used with the Ethereum blockchain protocol. Also, the JP Morgan team partnered with Microsoft for Azure blockchain platform, and changed Quorum’s privacy layer written in the Haskell computer language with Tessera , which has a comparable design, however is written in Java to make it simpler for organisations to utilise the privacy layer. This is done for enterprise-wise adoption of the network. Also, it seems that the Quorum network will continue to implement the open source innovations of the Ethereum community to make its network more robust. 

Overview 

Blockchain is seen crucial for banking innovation as it leads to better transparency of data as well as improve trust between the parties involved. It is for this reason that we have a surge of demand for blockchain developers, particularly in the financial sector. Indian banks certainly want to keep up with this innovation. But, the Indian government has mandated that financial data should remain localised within the borders, and therefore it will be interesting to see how Indian banks will participate in global blockchain networks. Also, we are increasingly seeing participation of Indian companies which are seeking membership in global blockchain networks. Apart from the Indian banks joining JP Morgan’s IIN, we also recently saw Tata Communications gaining board membership of the Hedera blockchain network. 

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