Why banks need to undergo 'bionic transformation'
5G will transform the way clients interact with their bank.
Dubai - As tech continues to evolve customer expectations and interactions, banks are quick to respond to meet their demands
Since developments in technology and regulation are disrupting the UAE banking sector, banks must quickly adapt and transform to address the current gaps in the market and remain competitive, says Sunil Kaushal, regional CEO for Africa and the Middle East at Standard Chartered Bank.
"Banks must go through what we like to call a 'bionic transformation' - this consists of blending digital and personal interactions to create a more responsive and cost-effective distribution model," said Kaushal in an interview with Khaleej Times.
"By combining human judgement and data, we are able to map out the entire customer journey, offering a personalised experience in the process. For example, millennials are a key market segment for us, and we are continuously working to provide solutions which meet their fast-paced and digitally connected lives," he said.
Kaushal believes that challenges may appear in the form of financial crime, cybersecurity and privacy. "To counteract these threats, banks must ensure that the right policies, frameworks and measures to protect their customers."
He said Standard Chartered Bank recently set up SC Ventures, a fully-owned subsidiary of Standard Chartered, and are in talks with potential partners to jointly invest about $100 million each in three financial sector start-ups across the region.
On the positive impact of Expo 2020 Dubai, Kaushal said it is going to be a great event for the UAE. "Not only will it encourage millions of people around the world to visit, it will also create significant economic impact for the nation."
Quoting a recent report by EY, Kaushal says Expo 2020 Dubai is expected to contribute over $32.7 billion to the UAE economy by 2031, creating over 900,000 jobs.
"Expo 2020 is expected to play a pivotal role in the contribution of the country's non-oil GDP, which the UAE central bank has forecasted to grow by 1.8 per cent this year."
"Expo 2020 puts the UAE on the global map and will serve as the ideal platform for international trade and global cooperation, further positioning Dubai as a regional hub. For example, Dubai-based ports operator DP World has signed an agreement with a Chinese conglomerate to co-develop a new 'Traders Market' next to the Expo site in an effort to promote the movement of goods and services," said Kaushal.
Excitement over 5G
The introduction of 5G technologies will have far-reaching impact on the banking industry in the UAE like elsewhere, he said.
"The banking industry is quickly being disrupted by digitisation and innovative technologies. As technology continues to evolve customer expectations and interactions, banks are quick to respond to meet their demands," said Kaushal.
He said the introduction of 5G would open a new world of unprecedented opportunities for digital banking in UAE. "With faster speeds, low latency and more reliable connections, we expect to see new innovations to be deployed especially on smartphones and other mobile devices. With such a high bandwidth, clients will no longer have to rely on Wi-Fi connectivity for heavy data consuming applications."
"We expect an increase in the adoption of video banking, direct and real time interactions with virtual relationship managers. Banks and clients will be able to exchange information and upload huge documents with minimal limitations. The digital banking experience will be loaded with much more interactive capabilities without slowing down the response rate. All this will be delivered at a much faster rate than it is today and will make user experience even more seamless than it already is," he said.
"5G will also provide huge benefits in the way clients interact with the bank. Banking is now part of what clients do every day and it has become a part of their everyday lifestyle. With 5G, the experience will be more seamless as banks will now be able to enhance their application with many more solutions, products, services and offers without affecting the computing capacity of the mobile devices."
Clients will literally be able to interact with their bank from anywhere via any chosen channel - SMS, WhatsApp, audio, video, exchange documents, etc, without the limitation of data size or buffering. 5G will ensure that banks undertake reforms in the way they use technology, for internal operations and customer engagement alike, said Kaushal.
"Many familiar banking operations such as payment services will attain new forms, extending to enhanced channels including wearables, IoT devices and virtual reality. The increased capability and speed made possible by 5G will also help shorten settlement cycles considerably while removing latencies on real-time transactional capabilities," he said.