Zero ATM fees, zero opening balance, no charge for the ATM card are some of the incentives for using the Standard Chartered’s SC mobile app. But there is more to the platform as MOSES RUTAHIGWA, head, retail banking, explains to Alon Mwesigwa.
What is the SC mobile app all about?
When we did an analysis as a bank, we discovered that the needs of our clients have changed – convenience and efficiency [are very crucial]. Our clients want convenience to access the services, more empowerment to be able to do anything with a touch of their finger.
In the long run, clients also feel engagement in our branch structure is a bit laborious and takes a little bit of time. Clients were asking how can I do this [banking] faster.
After assessing this, we revamped and enhanced our SC mobile app to include two things: as many as 70 self-service channels – for the client instead of coming to the bank, they can afford to order for a cheque book, check their balance and upload their contacts on their mobile and their offices.
For the new clients who want to join as a bank, gone are the days when you had to fill in loads of application forms – now you just do it on your palm.
How are you tackling security concerns that come with digital initiatives?
From a technical perspective, we ensure that our systems are adjusted against any hacking attacks – that part is thorough. On the client perspective, we put in multiple authentication methods for any transaction to happen. This means that the customer is able to understand and is empowered to avoid any threat to happen on their account.
The second is that when we notice that something happening on your account is irregular, we have our own back-end mechanism [to enforce] preventive actions as fast as possible. The other thing is that a client can afford to lock their account immediately if they notice something is [not clear] minus coming to the bank.
Security on digital platforms remains a big concern to the market and that should be emphasized particularly to drive two things: more client awareness on dos and don’ts on online platforms but also drive customers to be confident with the solutions they are taking on. So, authentication and client awareness are key [to us].
Your competitors have online platforms but also have embraced the idea of agent banking to reach more retail customers. How is Stanchart performing in that area?.
Agent banking is a very good for this industry. It is one wonder thing that has happened to this industry in the recent past, which will completely [change] the way banking is being done.
First, it brings down the cost of service to the client for an institution but particularly it makes services much closer as possible to the client. As an industry, that is a great thing. As a bank, we are in stages of introducing the same.
We are undergoing internal process but very soon you will see us coming out to the market in the same area. So, we are not sitting. We are doing some market analysis to get [this activated] because agent banking transforms the way we do banking, makes all our clients to be able to access financial institution as closer as possible than any bank can do within the brick and mortar set-up.
Stanchart has raised the issue of operational costs in its financials.
What impact will the SC mobile app have in cutting the costs?
The drive for efficiency is across the industry, not just Standard Chartered bank [only]. Different players are taking different actions to cut [costs]. As a bank, we believe there is more to do with expanding our [reach] in terms of client base than more to do with reducing of costs.
I believe as a bank, we are more leveraged and have quite strong rations. The focus is not necessary to say we are cutting down on the branches. However, we recognize that the app gives us a chance to be able to serve more clients at much more efficient rate for the bank and it also benefits the client more – they are able to pay lower fees or even no fees.
It makes the process of serving the clients safer in terms of accuracy, minimize human errors that can result from any physical engagement, and it helps us to have the clients get real-time services.
What percentage does online banking contribute to your revenue pool?
As a bank, we launched the retail online platform in 2012. Prior to that, we had been running the corporate one, which is over ten years old. On the corporate part, the contribution of cash collections through that platform is over 80 per cent. On the retail part, since 2012, we’ve gone on improving it.
The first time we launched it, it was more of a servicing, view balance platform. Later, we evolved it and added on the integration with mobile, mainly to do a withdrawal. Last year, we launched ‘mobile to the bank’, which became the area of cash collection and income generation to the bank.
The critical area we are doing now is onboarding a client. Our aim is to move away from using digital as a servicing mechanism to more of income generation. Right now, more than 80 per cent of our transactions are happening through these [online] channels. Less than 20 per cent of the transactions are happening in the branches.
PriceWaterhouseCoopers says by 2020, retail banking will look different from the way it is now because of customer expectations, regulatory requirements, demographics and new competitors serving people without going through the old bank. How prepared is Stanchart for this wave?
Banking is significantly evolving to address some of these generational changes in the industry. In terms of technology, I believe we’ve made significant progress [by] revamping our platforms.
On demographics, part of why we launched SC mobile app is to target the generation between the ages of 21 and 40 and have them access our services [without a hustle]. One of the reasons a student can open up an account with us is that he/she would want to know ‘can I do it on my phone?’ Also, a student would worry about ‘how much am I going to pay’. Not to say the product is for students, but it’s able to bank a wider range of clients.
As a bank we had to review our proposition so as to appeal to a wider audience, and not the old conventional format of banking. We no longer have phobia of looking at these new platforms [like mobile money] as competition but partners for growth. Telecoms are potential partners for collaboration especially when they are strong in the area of technology.
We’ve also ventured a lot into providing additional wealth services. In the old days, a bank was known for giving you a personal loan, but customer needs have moved away from [just] borrowing to ‘how can I enhance my wealth?’
So, engagement into having more wealth creation activities into providing advisory services and offering opportunities is another area we are adding. As a bank, we are positioned for growth and remain solid in terms of focusing on what our clients want.