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Tue 1 May 2007 12:00 AM

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Paper money

Financial institutions are coming up with new ways to cut printing costs without compromising security.

In a sector that is focused on maximising value and making money work hard, it is surprising that many financial institutions are still inefficient in their printing processes. Printing unnecessary pages not only wastes resources, but can slow down communication between departments and drag out the time it takes to complete transactions.

On top of this, many organisations find that much of their manpower is tied up in providing maintenance and support for their printing operations when it could be used better elsewhere. With this in mind, some financial institutions are choosing to outsource some or all of their printing requirements.

"The core business of a bank is to offer banking services, their core business is not printing," says Francois Feuillet, general manager, Lexmark Middle East. "Printing is a tool. For some customers we offer to control, analyse and supervise all of their printing from the hardware to the software, and the technical aspects." For example, UBS outsources all of its printing to Lexmark.

"Depending on the customer and their needs, we analyse and then we apply what they ask us to do," says Feuillet.

"We can implement software in the bank so all the data remains virtually in the bank. We've got another software called Data Feed Management where through a secure network we can analyse all their printers, all their installations, and we can by anticipation take care of all of their supply needs, repairs and supervise all of their data movement through our software.

"When we implement the software there is an agreement and we show which kind of data we will pick up from the network, from the printers, to our systems. Then they can see that it is only printing the data in those files."

Spectrum, headquartered in Dubai International Financial Centre, specialises in producing print runs of documents such as statements or annual reports, which can be customised to include each customer's name.

"It's more expensive than traditional printing, but they can literally send us a PDF and it goes to our print queue straight away," says Graeme Selby, sales director, Spectrum. "They are paying to have something that is much quicker and more flexible. We can print anything from one to 10,000 documents."

One of Spectrum's major customers is the Dubai Financial Services Authority, and Selby expects banks to find the service useful for areas like loyalty schemes and customer communication.

"We see financial services as a growth area," he says. "We can do it for anyone who collects data and wants to communicate with the names and addresses in their database."

As it deals with some sensitive material, Spectrum has measures in place to ensure data security. "We have a secure FTP and a secure online system where we give our clients a user name and password," says Selby. "We also have service level agreements in place with people including our clients."

Security is a major consideration even for organisations that manage their own printing. A major bank in Europe recently adopted solutions from Canon to ensure the privacy of its printed output. "The nature of bank documents is confidentiality," says Gautam Chakrabarty, senior product manager, Canon Middle East. "If you have a network printer and copier, papers remain in the exit tray. They asked Canon to design a printer where you don't have any output."

The printers have 100 ‘mailboxes' stored on each device, each assigned to a person and protected with a password. "Canon reengineered the drives so each compartment can have sub-compartments," says Chakrabarty. "You can go to the machine, access your mailbox, scan and send by email. You can read the document from the display, and combine documents and print them as a booklet." Documents can be scanned, then sent as an encrypted PDF file. "The person you are sending it to cannot open it or print it without the password," says Chakrabarty. "The way we have built the machine now, it's completely secure. We can also customise it for individual customers."

Canon's printers can also be used to create a sub-layer of print which acts as a watermark. Although the watermark will not be visible on the original printed version, it will show up on a photocopy made by any vendor's machine.

As devices become more sophisticated, there are data protection issues with the memory contained within machines.

"High end machines store some data on the hard disk to recall and print out at a later date," says Pradeep Kumar, regional manager, electronic imaging division, Toshiba. "Whenever you copy or print something there's always some data left on the RAM. Our latest products protect data on the hard disk and delete data from the RAM."

Kumar adds that new regulations and the need for financial institutions to provide a record of their transactions is driving the demand for printing solutions in the industry.

Toshiba is also helping banks to monitor their own organisations when it comes to printer use. "You can define centrally how many people can print in colour, and the network administrator can set a ceiling on the limit each department or project can print in colour," says Kumar. "CFOs could be concerned that people are printing out their kids' pictures."

However, he adds: "Total cost of ownership (TCO) has come down dramatically in the past two or three years. In the US, Europe and Japan, the majority of the equipment sold there is colour. We can be sure that in the banking sector, especially in the GCC, more and more people will switch to colour."

Cost efficiency is likely to be the area of focus for most procurement officers, but there are many different ways to measure this, not all of which give an accurate idea of lifetime costs. "Our printers are economical at the outset and economical to run," says Stephen Diamond, sales director, OKI Printing Solutions Middle East.

"It's not just the cost per copy, it's the TCO. "It's all very well looking, as many organisations do, at how much it costs. How much is it costing us to run this piece of equipment? In the banking environment, speed is very important. Inkjets are extremely slow and time is money. These are the kinds of things that banks factor into their requirements."

OKI has customers in the GCC, Lebanon, Syria, Jordan and Egypt, and can count Addax Investment Bank, Qatar National Bank, and National Bank of Kuwait among its users.

"Local banks are very switched on people and they're choosing their equipment wisely, bringing efficiency to their organisations and customers, and savings to their shareholders," says Diamond. He explains that some of OKI's customers are coming up with innovative ways to manage their printing: one bank headquartered in Dubai has a number of fax machines dedicated to communicating in real time only with each other.

Cairo Amman Bank adopted imaging, printing and management solutions from HP and has managed to lower its TCO by 10 to 30% as a result. Omar Yacoub, head of IT at CAB, says: "Numerous banking procedures are now much faster. For instance, loan applications, which previously required an unsecured fax procedure or slow site-to-site document transportation are simply scanned now and securely transmitted to the required office. We are seeing significant increases in security, management control and productivity."

Many banks are switching to multi-function products (MFPs), which combine a printer, photocopier and fax with email capabilities, and can produce economies of scale as a result.

"The premium you pay in switching to an MFP is 20 to 25%," says Ranjit Gurkar, general manager, printing and solutions, Brother Middle East. "If you were to look at the other option of having a printer, fax, scanner and photocopier, you probably end up paying three times the cost.

"The basic reason for this shift and growth in MFPs is the replacement cycle. An old printer probably cost twice as much as an MFP today."

Brother is also trying to make life easy for IT staff, using software on its devices that allows them to be better managed.

"With this software a network administrator can see any device on the network," says Gurkar. "It can send an email to the distributor so they know when customers are likely to need new toner cartridges or fault repair.

"It can analyse the way that MFPs are used. It also tells you how many paper jams took place and where."

Cartridge replacement itself can be a costly process, since ink is often not the only component to be replaced. Maki Nagao, product manager for Kyocera Mita, says: "A printer cartridge contains many expensive components that have a longer life than the toner that is encased with them. These include the drum, developer, developing units and cleaning units, all of which are unnecessarily thrown away when the toner has run out." Kyocera's printers use a non-cartridge system where the toner is the only consumable that is replaced, resulting in significantly lower running costs.

By paying attention to all of these considerations, banks should be able to ensure that they are looking after their money, both from a security and efficiency standpoint.

Opting to outsource

One company that has taken to outsourcing its printing is National Commercial Bank (NCB) in Saudi Arabia. The bank previously employed Xerox to take care of its printing and associated maintenance, but since moving to a purpose-built building has expanded the document management responsibilities it gives to the firm.

"Everything there, in terms of technology, people, and training is not NCB's hassle anymore," says Hosam Al-Yousof, support services division head, NCB. "It's all in Xerox's hands. It's basically what's called host to post. We directly give them a link to our IT equipment, they can download the data and print it and distribute it to the customer." All processes from printing to enveloping of customer mail are taken care of by Xerox.

Ben Gale, general manager, sales and marketing, Xerox MEA, says this is part of a growing trend in the region to outsource back office functions: "A large element of it is still being done in the organisations where they're bringing people in to sit on their sites and do the functions in a more effective way than previously they were doing themselves, enabling them to focus their resource on the job of looking after their customers."

While NCB obviously still has to pay for the services it receives, this is operating expenditure and frees up more capital to be invested in other areas of the business. "When you buy an asset as a fixed asset it goes on your asset sheet," says Al-Yousof. "If it goes on your balance sheet there is a cost to capital, and that cost of capital is quite high in this part of the world sometimes. Not only that, you would prefer the cash to be utilised as an investment in your own business.

"We are not in the document business, we are in the finance business. With 10 million riyals I can give a lot of loans to a lot of people to accumulate more money."

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