Standard Chartered's CEO Sunil Kaushal says continuous learning is key to innovating successfully in the digital sphere
Digital-only banking is Standard Chartered’s response to a growing demand for wider access to digital services.
Its African expansion encompasses eight markets since a pilot scheme in Cote D’Ivoire launched in 2018. By digitising the entire banking experience, customers have increased access to simple, secure and affordable banking. The accelerated roll-out, achieved in 15 months, is the result of an ambitious approach that champions innovation.
What is Standard Chartered’s definition of digital banking?
Most of us have been exposed to some kind of front-end application for mobile. But that’s not true digital banking. For us, the real proof in the pudding is if you can on-board a customer and process the transaction from start to finish digitally without the need for any human interface, and then have access to the data for analytics and analysis. End-to-end digitisation encompasses not only the front-end application but also the workflow that you have has to be digitised.
What has been one of the biggest challenges in successfully rolling out digital banking in Africa?
One of the biggest challenges was getting the right people together in terms of the core team. They had to believe in the vision. It was a different way of doing things and a natural human reaction to change is resistance. You may not have the opportunity to break through resistance if you are accelerating, so you have to get people that are like-minded. You need to have an enthusiastic group who believe in the vision and the opportunity, and who believe it will benefit them in terms of their own learning and careers. They become the ambassadors to implement something and to convert others. You can’t have resistance at every point. The proof of success is we have implemented the project in less than 18 months in so many markets. We created the core platform and we are now opening it out to fintechs to come in and participate on our platform.
What lessons can be learned from the roll-out in Africa for our region?
We are learning as we are going and learning has to be continuous. There is no final destination. One big lesson for me is that whenever we have seen fintechs and technology thrive in particular areas, are areas where we as an industry have made it difficult for our customers. Payments that require reams of written information to make a remittance and small ticket borrowings, for example, have been completely disrupted and we believe there are other pockets within the banking sector that represent an opportunity in terms of potential to simplify. I think there is a misconception that fintechs don’t want to work with banks, but on the contrary they are looking at a robust platform where they can offer their products so it is a complementary.
When I am travelling to markets I tend to spend time with fintechs and talk with them about what we are doing while learning about what they are doing. This is so we can explore ways of working together. When you are creating an ecosystem, you want more players to come on to the platform. That is how are able to meet evolving customer requirements.
How has end-to-end digital banking affected the countries and societies into which it has been introduced?
It is early days to make a broad statement about how it has impacted society at large, but I would say that it has created a lot of buzz in the markets, because we are introducing a state-of-the-art offering. Secondly, it has expanded our reach significantly. We are not restricted by distance and physical presence and we believe have attracted the younger population in greater numbers.
Typically banks are seen to encourage people who have steady incomes or a nest egg, but with this sort of application we have created customer value propositions specifically targeting the younger population. For instance, in Ghana, we are targeting students at the top universities because we know that the next 10 years they will be the emerging professionals. For us, it has opened up the market.
What is different about Standard Chartered’s digital banking compared to other banks?
Today, many banks have a front-end app, but few have the kind of digital end-to-end backbone that we do. From a learning point of view, the learning curve for achieving this was very steep. We built the end-to-end ourselves in-house because we wanted to possess the expertise in doing so. The digital bank in Africa was designed to be a complete end-to-end process with no human interface – except if you really need to speak to someone, then you have that option. But otherwise it is completely digital. The platform includes 70 of the most frequently used services available on the mobile. You don’t need a call centre with endless holds, you can just press a button and everything is available. It is about giving full optionality to the customer, with real-time update.
Why was Cote D’Ivoire chosen for the first roll-out of this service?
We didn’t have a retail presence in Cote D’Ivoire so we wanted to see what a standalone, pure digital retail bank would look like. Additionally, the country is bilingual, so we wanted to learn from that overall experience. Africa is a market where you need to provide all the functionality and capabilities at the right price point. The technology was built on an underlying African technology stack within the bank.
Why is it important to be ahead of the curve in a digital world?
We have competition from a lot of different players and we have to look three to five years down the line. Banks in the past were caught out when payment solution companies and fintechs started coming in. However we do have certain advantages that we are trying to build on. And that is we have a license to offer all financial services products. We have the trust of our customers to protect their money. And we have long-term relationships with all these customers. For younger generations their loyalty factor is quite limited they are uninhibited in that they can move from one bank to the other quite easily. We have an existing customer base and existing business which is profitable. So in looking at the longer term it is about looking how to make it more profitable.
Standard Chartered has also recently moved into social banking with the launch of SC Keyboard. How does this new app work?
We just introduced SC Keyboard in Kenya, Uganda, Ghana and Tanzania, with plans to roll out to Botswana, Zambia, Zimbabwe and Nigeria throughout the rest of the year. If a bank customer is on social media platforms such as WhatsApp, they can download SC Keyboard, which shows as an SC icon. Users can click on the Standard Chartered icon and it connects to the back end of the mobile application and you can make payments while chatting. It makes interactions simpler and more intuitive – we are committed to leveraging the best technology to bridge the human and digital.
The good old days when banks were open when people were working and closed when they weren’t are gone and people interact with their banks 24 7. We provide an omni-channel for our clients so they can decide how to interact with us. Our learning is customers want 24-7 banking that is quick and simple and at the right price.