I-flex describes itself as an e-infrastructure company for financial services in the net economy and is vertically focussed, providing complete end-to-end solutions to financial institutions. With 30 per cent of its employees coming from a banking background, the company has a host of experts in banking, security, insurance and capital market sectors.

The company offers its flagship product - ''Flexcube'', a wholesale back-office banking system based on an ASP model - for a fraction of the cost of setting up the infrastructure.

The ASP model, through its joint venture with HDFC Bank - Flexel International Pvt. Ltd.- will offer IT infrastructure, complete with hardware, software, and communication systems to its clients. As of now, ''Flexcube'' is touted to be the second largest selling wholesale back office system in the world.

"Joining the net bandwagon would enable smaller banks to operate at the same technology level as that of the larger banks," Mr. Deepak Ghaisas, chief executive officer of I-flex Solutions, said at the launch of the company’s third development center in the country at Pune on January 12, 2001.

The model operates on the principle of fixed costs converted into variable costs. The recipient banks would have to invest a fraction of the cost -- between five to seven per cent -- towards simple infrastructure like tellers and other small furniture. Charges would be levied on the basis of the size of the portfolios, Mr. Ghaisas said.

Besides this, an ASP model will also help in cutting down lead-time. "Usually, IT implementation cycles are very long. With an ASP model, the smaller banks would not only avoid initial investment, but also will be able to offer immediate services to their customers," he pointed out.

The model, to be unveiled on a full scale during the second quarter of 2001, has already found two takers, one of them being Nedungadi Bank. The state of Maharashtra, with its flourishing co-operative and private sector banks, will be a fertile ground for this model, believes Mr. Ghaisas.

He said, "Revenues from the ASP model will strenghten our joint venture within the next 18 months. And once the model attains stability here, it will be replicated in other countries as well."

The company, which began its operations in 1992 as Citil, the IT arm of Citigroup, rechristened itself to I-flex Solutions last year. Growing at a compounded annual growth rate of 70 per cent since 1993, I-flex closed fiscal 1999-2000 with a revenue of Rs. 206 crore and a net profit of Rs. 69 crore. Reeling out statistics, Mr. Ghaisas proudly says, "During the last seven years, we have increased revenue 29 times, profits 65 times, manpower five times and customers 21 times."

The company, which already operates two development centres at Mumbai and Bangalore, will use its Pune centre as a centre of excellence for credit cards, e-payment systems, e-commerce security consulting services and products, and systems integration for I-flex products.

According to Mr. Nandu Kulkarni, the company decided to focus on these areas because the increased use of plastic as a form of payment and the internet being used as its medium were converging into e-commerce.

"The Pune centre will help the company to bolster the number of on-line payment mechanisms, especially in the area of credit cards by enhancing its software to smoothen payment procedures," Mr. Ghaisas said.

Once fully operational, the Pune center is expected to contribute between 20 to 23 per cent of I-flex''s annual revenues.