Digital Footprint and Technology Transformation

With the impact of the COVID-19 pandemic affecting every aspect of private and public life in the Kingdom, the Digital and IT teams – which together man an essential operation of the Bank – focused on accelerating already established plans.

Overcoming the challenges of a pandemic year

The adoption of a faster pace was achieved in tandem with providing the various digital solutions required to ensure business continued smoothly in the face of restrictions and a lengthy lockdown. These solutions addressed a mix of software and hardware issues with the latter including the provision of new servers and network devices.

Despite the challenges of the year under review, the Digital and IT teams delivered transformational changes supporting core business functionality and digitalisation. These achievements include:

  • Migration to new data centre
  • Maturation of the Application Programming Interface (API) platform in which IT has published more than 100 APIs
  • Full revamp and capacity uplift of mobile ecosystems on different layers to cater to increasing business and customer demands
  • Delivery and roll out of new Treasury core system
  • Delivery of a number of mortgage products
  • Completion of 98 out of 256 planned initiatives despite COVID-19 restrictions

With employee numbers remaining largely static, the Technology and Operations team focused on enhancing the Bank’s institutional knowledge. A number of training programmes were arranged to help familiarise nearly 150 key employees with the new software needed to improve the operational efficiency of the Bank. Meeting the needs of external and internal customers during this time was possible thanks to management support and inter-departmental collaboration.

While putting in place the necessary measures to allow employees to work and learn remotely, the Digital and IT teams adhered to all processes and procedures set up by the Central Command Control Centre. Most of the digital team worked remotely, with the executive team remaining on-site while ensuring proper social distancing measures remained in place.

The Bank witnessed a large migration of customers to digital platforms as a result of the pandemic. The digital roadmap was delivered faster than anticipated during the year under review, with more capabilities than originally anticipated included in response to feedback from customers and employees. To meet the demands of increased traffic and ensure an optimal customer experience, the digital team also upgraded backend systems to maximise capacity and performance.

While the pandemic negatively impacted international card transactions and increased defaults on personal finance, there were many positives as well. The migration of customers from physical to digital banking, for instance, increased with more than 100,000 current accounts being opened digitally every month since July 2020. While POS and credit card transactions showed great adoption, more customers have registered for Mubasher than ever before with the month of May seeing a record 183,000 customers registering for this online service.

Expanding the Bank’s digital footprint

Despite its prudent approach to banking, the Bank is making a name for itself as a leader in introducing new and innovative products and services to the market. These initiatives have helped the Bank to enhance a number of its capitals through improved relationships with customers, suppliers, business partners and the community. The expansion of the Bank’s digital footprint also positively impacts its Intellectual capital (including knowledge, systems, and processes used by employees).

Continuing with its comprehensive digital transformation initiative, which was launched in 2018 based on a “mobile first” approach, the Bank focused on the four core themes of its digital strategy to:

  1. Expand smart channels and formats
  2. Enhance customer journeys
  3. Migrate customers to self service channels
  4. Deliver innovations in terms of payments

During the year under review, the Bank significantly expanded its digital footprint becoming first to market in a number of areas so that customers are able to enjoy end-to-end digital processes for regular banking transactions.

Products and services – First to market

  • Digital promissory note (SANAD)
    With the onset of the COVID-19 pandemic, customers were provided with another banking product which could be activated digitally. The digital promissory note is relevant for all available end-to-end digital products from personal finance and credit cards to mortgages making life easier for customers at a time when many are reducing their movements in the community.
  • Online signing of mortgage contracts
    The Bank also successfully implemented online signing of mortgage contracts. Customers can now accept a mortgage contract online without having to go through the branch for verification.
  • Digital car insurance application
    Customers can also now apply for Takaful car insurance using the retail mobile banking app. The introduction of this digitalised process means that customers no longer need to stand in queues, restricted by social distancing rules but can apply for their car insurance from the palm of their hand.
  • Beneficiary addition by mobile number
    Reducing the need for customers to visit the Bank for mundane but necessary tasks, the Bank simplified the process for adding a beneficiary. A customer is now able to conveniently make payments to friends, family and acquaintances by adding a beneficiary via their mobile number instead of having to input the required local or international bank account number.
  • Beneficiary addition by QR code
    The Bank has also made it possible for customers to conveniently add friends, family and acquaintances as beneficiaries who are then able to share with payee by scanning a QR code. The convenience and flexibility of not being constrained by time allows customers the ease of completing transactions efficiently from any location. This process allows the Bank’s customer base the option of cashless and digitally enabled payments with the swipe of a screen.
  • Online current account opening for customers aged between 15 and 18 years old
    Another innovative first-to-market by the Bank was the ability for a guardian to open current accounts for children between 15 and 18 years of age, without having to enter a branch.

Other digital innovations launched during the year under review include the digitalisation of the following:

  • Application for pre-paid cards, digital pre-paid cards, credit cards and travel cards
  • Complete revamp of new current account opening via mobile

Network and reach – Expanding horizons

During the year under review, the Bank launched two new digital platforms for a customer segment that was, arguably, the hardest hit during the global pandemic – SMEs.

The new unified eBusiness platform allows start-ups and corporate customers alike to conduct their banking online through a computer. The eBusiness platform provides customers with greater convenience to process transactions at any time almost instantly. Due to the large number of transactions customers may also easily miss unusual activity in their account, but with instant access that the platform provides they can review each day’s transactions with ease. With Internet banking, the Bank’s SME and corporate customers use less paper – and so does the Bank – making the eBusiness platform a greener banking option in many ways.

Another new initiative introduced during the year was eBusiness mobile – the mobile app for SME and corporate customers. Through eBusiness mobile they can now perform most tasks on the go, from approvals, payments, and transfers, to point of sale requests.

Service standards – Improving self-service

Multiple self-service improvements were introduced during the year to provide customers with greater control over their funds and transactions.

With eStatement now available through the Bank’s mobile app, customers are able to monitor their accounts more conveniently – a feature that has been useful to customers unable to visit bank branches during lockdown but will also be one that will prove equally important to them once communities open up and they are able to move around more freely.

While the core mandate of Sadad is to facilitate and streamline bill payment transactions of end consumers through multiple channels, the Bank introduced scheduled bill payments so that customers need not worry about missing any payments. Other improvements to service standards include the ability for customers to cancel product applications through their mobile phones without having to contact the branch or call centre and the addition of current accounts.

Increasing the number of customer touch points the Bank also introduced WhatsApp as a communication channel and launched a new self-service chatbot for frequent queries which can be answered immediately.

Increase in digital banking customers

As a result of these and other initiatives conducted by the Bank during a year when COVID-19 restrictions made it difficult for customers to visit the branch, the Bank was nevertheless able to witness an increase in the number of digital banking customers from the year’s beginning to its end. Many of these innovations were a result of the Bank acting on feedback from stakeholders including customers and employees.

Number of digital banking customers

Platform January 2020 December 2020
Mubasher (Mn.) 5.1 6.8
Tahweel (Mn.) 0.5 1.00
eBusiness 43,000 78,500 (including SME)
Total (Mn.) 5.7 7.9

Enhancing business operations

Being customer centric requires the Bank to provide innovations for customers as well as employees. By streamlining and automating internal systems and processes, the Bank ensures that its people are able to serve customers with greater efficiency and accuracy.

Leveraging on advanced technologies such as Intelligent Data Capture Automation, the Bank has built an on-premise AI-powered engine which processes unstructured data (Arabic and English) to help provide business optimum solutions to improve execution excellence within the Bank’s operations. Other enhancements made during the year under review include those made to the operations of the Bank as well as the call centre. The online functionality provided to customers reduces traffic at branches and frees up frontline employees to be able to respond in a timely manner in finding solutions to meet the banking and financial services needs of its customers.

Other initiatives undertaken during the year to improve business operations include the establishment of Muwatheq services in all cities and control procedures to ensure that property transfer requests are monitored. The Bank used robotics solutions for payments operations processes, purchasing commodity from brokers’ platforms, and for personal loans and car leasing credit approvals. The automation of communications and notifications to the corporate banking clients and customers and the outsourcing of the Trade Operations function and Merchants Operations function were other initiatives of the year.

In addition, due to a number of enhancements undertaken to improve the Bank’s ability to lower expenses for consumables, kiosk performance increased by 2.3% in 2020 compared to 2019.

The initiatives undertaken by the Bank in the year under review received regional recognition. The Bank was the recipient of the “Excellence in Digital Banking” Award from Finnovex Middle East 2020 – an award that honours the pioneers and visionaries who have transformed the financial services industry.

Future outlook

The pandemic has revealed a number of growth opportunities in services that help customers in their day-to-day banking transactions. For instance, with Retail Banking customers finding access to branches restricted during the pandemic, the Bank has seen a greater willingness in this segment to better understand their finances. Using digital solutions to help such customers navigate through times of uncertainty is an avenue that the Bank is exploring. Services such as personal finance manager can be a very useful tool for such customers, helping them to understand budgeting and “safe to spend” opportunities. The Bank’s Corporate Banking customers see opportunities in digital self-service, where the Bank’s eBusiness platforms allow them greater control and of their funds without having to visit the corporate branch. The Bank will also be exploring ways to expand POS services as society becomes increasingly cashless.

In 2021 and beyond, the Bank will continue with its push to provide stakeholders with end-to-end digital systems and processes.

The main challenge for the future comes from increased competition by fintechs and cybersecurity attackers. New entrants to the market offer a great customer experience and attractive pricing for their services. In order to remain competitive, the Bank needs to continue providing the best customer experience of the market.

The Bank also has a comprehensive plan to further strengthen cybersecurity. The plan includes the elevation of compliance level with SAMA CSF to Maturity 4, compliance with National Cyber Authority ECC and CSCC standards, and adoption of the eGRC solution to enhance the operations and automation processes.

Following its BOTF Strategy (refer page 41), the Bank will build resilience and a platform for innovation through a continued focus on modernising technology, leadership in data driven insights and agile working. The Bank will look to deliver the best digital bank value proposition in the market, leverage its digital banking capabilities across a wide range of customer groups, provide the best customer experience and have a differentiated and focused digital marketing approach across all segments served. These actions will be supported by digital-ready platforms that are responsive and scalable; aligned with business strategy and the demands and trends of the market.

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