Technology enters a new age

This month's profile of CBI and news of Mashreq's rollout of Postilion software show that banks are entering a new phase in their use of IT.

Rather than the simple automation of manual jobs that represented the first phase of IT implementation, banks are now thinking carefully about how they can use technology to boost customer service and actually increase sales.

CBI has used SilverLake software to help it rebuild the core banking system that runs its operations. The software supplier won the contract because it has a fully functional Islamic banking module, in addition to ATM and card management systems. EMW was employed to perform the integration.

According to the bank's CIO, Faris Saddi, "we actually realised a saving of US $4.3 million per month as a result of changing the system. There was a lot of process saving."

Mashreq hired Postilion to replaced its existing payment switch infrastructure. The new systems are being used to run the bank's ATM network, point-of-sale (POS) terminals and introduce new integrated POS services for retailers.

According to Postilion, the implementation brings operational improvements and financial savings as well as delivering faster, more efficient service at the ATM and POS.

As the new infrastructure replaces a number of separate applications, it has to support all of the bank's existing channels and operate as a single integrated solution.

Replacing multiple applications with a single integrated solution also provides the bank with the ability to create consolidated reports on payment processing and performance to support better management decision making.

Adoption of technology can undoubtedly be a good thing for banks, but there are factors that need to be considered. As in many professional fields, the skillsets needed to implement customer facing IT systems are specialised.

It is vital for banks to have the in-house skills to maintain CRM systems, and to ensure that the systems integrators in the local market are up to the job of initial implementation and post-sale support.

ICT should also never be seen as way to reduce human interaction and, in particular, branch overheads. Advanced call centre and internet banking solutions should build on the relationship that a customer has with the agent at their bank branch.

Close down branches and customers may decide to go elsewhere. However, used as a complement to existing forms of customer interaction, modern IT systems can give adopting banks a competitive edge.

David Ingham is the editorial director of ITP Business.

RELATED LINKS: No time to lose, Mashreq opts for Postilion

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