Mashreq Bank: Digitisation mustn’t leave face-to-face customers behind

Retail banking head Subroto Som explains that although the UAE's oldest bank may be digitising its internal processes, branch staff will always be a friendly face for consumers who want a human interaction

January 5, 2018

Mashreq Bank celebrated its 50th anniversary in 2017. It’s the UAE’s oldest bank, and has been innovating throughout its history, achieving a number of notable firsts in expanding financial services in the country. Head of Retail Banking Subroto Som talks us through those achievements, and Mashreq’s ongoing internal digitisation journey. But, he explains, there are still consumers who want to talk to a branch employee, and they cannot be ignored. Digital-only banks like Mashreq Neo are a choice for consumers – they shouldn’t be the be-all and end-all of financial services. He also discusses the challenges in the UAE’s retail banking industry, with some consolidation in the hyper-competitive market already happening.

World Finance: Mashreq Bank is celebrating its 50th anniversary this year; talk me through some of the key achievements in that history.

Subroto Som: In 1978 we were the first and only bank to have established a presence across all the seven emirates of UAE. Then in 1981 we were the first bank to introduce debit cards and credit cards in the UAE; followed immediately by introducing ATMs in 1983.

Then in more recent times we were the first bank to introduce online banking, followed that up soon thereafter to introduce mobile banking in 2008. The UAE is introducing digital and mobile wallets: we were the first bank to bring the Samsung Wallet in the UAE, and we were in the first batch of banks to launch Apple Pay in the UAE, and we already launched Mashreq’s own proprietary Mashreq Pay wallet, also to help our consumers in the UAE.

Mashreq has always been a bank that has been innovative; it’s in our DNA. And it’s a bank that’s ready for the future. In fact in many ways, it is a bank that’s shaping the future.

World Finance: So does the new digital-only Mashreq Neo point to challenges in the physical retail space?

Subroto Som: The bank has actually increased the number of branches even in the last 12 months: we’ve actually increased by 12 new branches. But I think what happens in a branch has changed significantly.

To give you an example, when you go to a branch and you want to update your personal information, you typically will be asked to fill out a form, sign, the branch will verify your detail, will send to the back office, the changes will be made, and the process could take anywhere from six hours to a couple of days. It’s a very manual process filled with a lot of paper.

The same thing could be done in mobile banking, or in online banking by the consumer, by just inputting it. So we thought about just changing the branch process, that when a customer came to do a similar activity, we could get him to input the details directly onto the system, and get it done instantaneously.

We have been investing in what we call converting the bank digitally inside for quite some time. And that uses the whole process re-engineering, big data analytics, AI and robotics. So that journey has been on for quite some time. So today’s branch is a lot more digital, it has a lot more machines, it has a lot more things that consumers can use directly. And you are not depending to talk to an individual.

But at the same time there are consumers who are very comfortable talking to an individual, talking to a branch employee, and you cannot ignore them.

World Finance: What challenges are you experiencing in the retail banking space in the UAE?

Subroto Som: As you know, UAE is a very competitive market, for the market of its size: we have over 30 retail banks. So the first challenge will be consolidation, and I think some consolidation is happening.

The second is as I mentioned; the credit bureau has come into place for the last couple of years, and that has shown that there are segments and pockets of the economy where there is high leverage, and de-leverage is happening. That has its own stresses and challenges.

Most banks are moving towards digital, and hence the interplay of digital process and banks’ legacy system is a challenge in itself.

And last but not least, we should not underestimate the balance between ease of a transaction and the security and safety of the consumer and the bank. And there’s a constant battle to balance the two.

So we have always been innovating. We spend huge amounts of dollars and dirhams in staying ahead on technology, on finding the right solution and new products. And we’ll continue to do so.

Our key interest is in bringing the best in breed products to the consumer, and looking after consumers’ convenience and safety. We will continue to invest in that.

And it’s a journey. It’s a journey with the consumer. Many of the things that are happening are new; it’s a path that we are confident of, and we have been on this journey for quite some time.

World Finance: Subroto Som, thank you very much.

Subroto Som: Thank you very much.