This event which for the first time took place in Kuala Lumpur, Malaysia was fairly successful with a full house attendance from top banks in Malaysia such as Maybank, CIMB, Alliance, UBS, and so forth.  It was organized by FST Media, an Australian based financial tech publication.

Key themes that kept coming up were along the lines of big data analytics, mobile banking, user experience and personalization.  This is consistent with other banking conferences we have attended globally showing that Asia is on par or in some areas leading the charge in technology.  Social and mobility banking particularly stood, where almost all speakers mentioned about it.

Below are some points that in my opinion is not only applicable to banks in Malaysia, or South East Asia but I think all financial institutions need to start thinking about it.

Challenges facing banks

4 main challenges were summed up nicely by CIMB, one of Asian’s top regional bank and number two in Malaysia.

1)      Technology

–          Demand for multi-channel banking

–          The rise of social banking

–          Device proliferation

2)      Consumer’s expectations

–          Lowering of consumer trust and loyalty

–          Consumers getting increasingly impatient. Convenience comes first

–          Wants things fast and constantly changing their demands

3)      Increase in competition

–          Non-banks

–          Telecom operators

–          Internet giants

4)      Stringent regulation

–          Increase in compliance

–          Increase in reporting and frequency

 

 

Creating a single regional platform

CIMB is now moving to a single regional platform to service all their countries across Asia with the goal of having consistent customer experience, a launch pad for innovative offering and lastly to create a borderless and seamless banking environment.

 

“You have to standardize your process and have consistent customer experience. No one cares about what backend you use.”

–  Devabalan,  CIMB Head of Transformation Office-

 

 

 

 

The dilemma of upgrading your core or doing the peripheral first

It is inevitable that banks will have to upgrade their core every few years to meet with the latest technology demand but with every upgrade, it could mean an entire system freeze for the next 18-24 months leaving banks a sitting duck.   Some banks are taking the strategy of running ahead on the front end and all the value adding services to be ahead of the market before they embark on the core whereas others are setting the foundation with a core revamp first.  Both strategy has its pros and cons and is very much demands on the internal strategy and roadmap of each bank.

There is also a need to include an end-to-end monitoring system. When something breaks, how does a bank know? Perhaps there are alerts in place for the core banking but as more and more apps are built and interfaced around it, chances of dependency failures are increasing.

 

“We have to be mindful chasing technology; we don’t want to go from cutting edge to bleeding edge.”

–          Mohd Suhail Amar, Maybank Head of Virtual Banking-

 

 

 

 

It’s all about user experience

Microsoft CRM lead in Asia, again reminded the banks that it is all about single user experience. Customers are also increasingly expecting self-service and self-directed delivery.

The executive director of Dell Software added that users have now an expectation on how an app should look like and how it should response. So when your bank’s touch point does not coincide with the latest norm and expectation, don’t expect a large take-up.

User experience also means having consistent multi-channel experience where a user going from mobile banking in Malaysia to doing a separate branch transaction in China should be the same if it’s under the same bank. However, being mindful of the cost as not every bank is performing well and could not afford to maintain the same experience across their channels, banks are now taking the strategy of segmenting and profiling their channels seriously. They are asking themselves since budget is limited, which channels should they be excellent and which channels should they be just good enough.

IDC brought up the topic of being hyper personalized. Every communication should be targeted to the particular user and there should be a strategy and process on going about it. Even a single question posted “who decides on the layout of your landing page” had no consistent answers from the bank. That itself showed there a clear gap in thinking about user experience.

What was interesting was introduction of user experience monitoring. IT has plenty of monitoring systems to monitor the core and peripheral systems but why not user experience?  Definitely we will see more about this in the near future.

 

“Think in terms of how it solves a customer problem and not what the product can do.”

–          Eric Tachibana, CTO APAC UBS-

 

 

 

Going about Social Media

One thing was clear is that social media is about increasing organic growth and experience where your users are able to interact with your organization. It should not be viewed as an instant holy grail where you expect revenues/sales to come in the moment you tweet or post something.   5 tips on going about social media in your Bank:

1)      Your social strategy should be orientated around people not products

2)      Be clear on what are your objectives around social media?

3)      Content is king. Ensure your posting has value, relevance and inclusiveness.

4)      Plan your campaigns and postings in advance.

5)      Measure your success, especially in terms of reach, brand resonance and reaction.

There is also a high value if you properly map data from social media to those data you already have in your CRM along with other third party data. This enables a financial institution to better create customized segments/ clusters of users for targeting purposes.

 

“People are willing to talk to you on social media if you are willing to do the same.”

–          Roy Heong,  OCBC Bank Head of E-business and digital marketing –

 

 

 

 

But one challenge posted by a major bank was, how do we really monetize a transaction via social media or is there even an opportunity to do so?  Is there a real quantifiable ROI?

Understanding Big Data

Big data is here to stay because of the 3 Vs. Volume of data is increasing tremendously, the variety of data that is obtained is also increasing and lastly the velocity of it.

Along this topic, 4 areas that banks are looking at

1)      Are there best practices to uncover hidden patterns or unknown correlation in all the available data sitting in various silo pockets.

2)      Working cross-divisional to have a single source of customer data. Eg: Taking consumer banking and wealth management data together.

3)      Ability to get new data and other footprints to analyze

4)      To work with other sectors with large data to better understand your customers. One large unexplored area for example was healthcare.

Using the Cloud

We get the feeling that cloud is not well understood enough within this industry as well as the regulators. Many banks are starting to monitor the latest development in cloud but there needs to be more discussion carried out especially on the regulator’s stand point before the banks embark on this idea.

Internally, Banks also need to work out the exact cost savings and how far away in the future could these cost savings beat the cost of risk exposure.

An area of benefit that was being mentioned besides cost savings was that there is the possibility of having a stronger risk and fraud management practice within the cloud.

 

Improving internal communications and having an internal knowledge management

As the workforce becomes increasingly mobile and some banks going regional, how does the organisation contain information? How does a bank create an internal knowledge management portal?  Lotus notes is no longer capable to meet internal demands.

Some have thought of enterprise social network such as Jive. However, they are hosted on the cloud and that poses a big problem to financial organizations and hard to customize according to internal controls.  A need for self-hosted secured solution would probably be in the form of solutions such as Undiscuss, where it has the ability to be self-hosted entirely within the bank.

 

Other topics to keep an eye on

These topics were also covered briefly showing a simmering need to address it more in the one

1)      Data security

2)      Compliance

3)      Improving internal IT processes

4)      Non-bank competition such as telco or wallet concepts.