Digitalisation has moved to the core of everything businesses do, and while for some it may still be a pressing issue to play catch up, for others it has become the norm, with digitisation at the heart of systems, processes and indeed the customer experience. The last 18 months have seen an acceleration in digitalisation as many businesses have reassessed their strategies and operating models to ensure they remain relevant and embrace the benefits that digitalisation can bring.
The regional financial sector is certainly no stranger to this move. A sector once over-reliant on cash payments saw a sharp increase in the use of online banking, contactless payments and mobile wallets as consumer behaviour shifted and confidence in new ways of doing business were adopted at a pace never seen before. However, digital transformation in banking for traditional players is a long journey and much more complicated than just providing online accounts and payments services. It involves deep infrastructural changes and the applications of new technologies such as security, cloud-computing, machine learning (ML) and artificial intelligence (AI).
Newer players and emerging FinTech providers have had a clear advantage due to their agility as well as their absence of ‘legacy’ products and services to overhaul. They have had the ability to rapidly develop their business models to attract customers who want the digital experience.
Due to the ongoing pandemic mobile money services have become increasingly important. Not just for digital payments, but also for those in low- and middle-income countries who needed a safe and secure financial lifeline. According to the 2021 State of the Industry Report in Mobile Money, mobile money-enabled remittances increased by around 65 percent year-on-year from 2019-2020, and for the first time ever, the industry processed over $2 billion a day in 2020.
As the leading mobile virtual network operator (MVNO) in the region, digital has always been at the core of the Virgin Mobile business proposition. We currently have over 3 million customers already utilising our digital mobile services, so when we combine this with our existing regulatory compliance, robust digital framework and regional customer base, extending into mobile financial services was a natural step in our growth strategy.We see mobile financial services as key to promoting financial inclusion in the region among a largely expat population, as well as a safe, secure and easy route for electronic international money remittance. This will also further help boost regional economies as countries work towards establishing digital as a core modus operandi.
So, while the digitalisation of financial services marches on at a relentless pace, what are the assets you may be able to pull upon to ensure you are providing your customers with a unique digital service experience in the fintech space?
Regulatory compliance and risk management
It is vital to keep all systems and processes compliant with all directives coming from regulators. Fundamental examples of this are reliable know-your-customer (KYC) systems, robust data security and privacy, and anti-fraud monitoring to name a few. But beyond simple compliance you should also see how regulatory paths feed into your own strategies, as they open up new service and revenue streams.
Digital infrastructure and resources
Staff and digital technologies are internal assets that must be built and allowed to grow as digital services and digital experiences develop and evolve. Digital mindsets must be allowed to flourish and challenge the norm, and so staff must be invested in, motivated and given space to think. Similarly, technologies need to follow that path and the strategies set, so that implementation and customer experiences are seamless, surprising, and reliable. Furthermore, a robust data strategy must be built. This is required not only to capture performance metrics of the business, but truly harvested using for example AI and ML to unearth customer insights and improve the service experience, doing the right things better.
Brand purpose and the environmental, social, and corporate governance (ESG) paradigm
Over the last decade, many of the world’s leading brand-owners have embraced brand purpose as a means of strengthening emotional engagement, an agenda that consumers have responded to. Having a strong brand purpose and an authentic sustainability programme rooted in digitalisation can contribute towards maintaining and growing a loyal customer base, indeed it is expected.
The ESG paradigm is increasingly important, and the digital carbon footprint of your business cannot be overlooked. Virgin Mobile’s brand purpose is to “make mobile better” and this applies to all facets of our business – from providing innovative, digital service experiences and promoting financial inclusion, through to offsetting our carbon footprint as a business through various sustainability commitments and initiatives. Digitalisation has a huge part to play in this aspect of how we all build our businesses to be truly fit for the future.
Impact on the bottom line
Finally, how are any changes you’re making going to impact your business’s financial performance? What is your long-term objective? And how do the steps you’re taking now to digitise your organisation impact the overall company’s valuation? These are core questions you need to examine before investing in your digital strategy and transforming or diversifying your business.
This strategy in action has seen us grow our digital services and create a business model that allows for future expansion – both geographically and across different sectors. In January 2021, we signed a strategic partnership with Saudi Investment Bank, making Virgin Mobile Middle East and Africa the first entity to be awarded a banking agent license in Saudi Arabia. We will be imminently launching a new product in the kingdom that will provide our multi-million customer base with easy, fast and more convenient digital financial services, including electronic international remittance. This will not just enhance the mobile experience even further through FinTech but will propel Virgin Mobile Middle East and Africa into a growing market segment.
This is the power of digitalisation – it allows you to create new offerings, enter new geographies, build brand loyalty and expand your customer base. A strategy that is backed up with financial rigour and one that also contributes to your ESG performance is critical – and it is the businesses that take this holistic approach that will unlock long-term sustained value.
Erik Dudman Nielsen, group CEO, Virgin Mobile Middle East & Africa
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