The Pak Banker - - COMPANIES/BOSS -

Mo­bile bank­ing is the fastest­grow­ing seg­ment across the globe due to its in­creas­ing pop­u­lar­ity and the UAE is no ex­cep­tion. It is part of the core bank­ing strat­egy of most of the fi­nan­cial in­sti­tu­tions that are de­vel­op­ing mo­bile apps to cash in on the high de­mand from the bankers.

Latest data sug­gests that UAE bank­ing cus­tomers are con­duct­ing more of their ev­ery­day bank­ing through their mo­bile phone. The UAE mar­ket as a whole re­mains very branch-driven, but high us­age of online bank­ing and mo­bile bank­ing is preva­lent in ad­di­tion to branches.

Ac­cord­ing to RFi's 2015 first-half sur­vey of UAE re­tail bank­ing cus­tomers, there is a high pen­e­tra­tion of dig­i­tal bank­ing us­age among the UAE pop­u­la­tion, with 82 per cent of UAE cus­tomers us­ing at least one dig­i­tal bank­ing chan­nel. About 61 per cent have in fact con­ducted online bank­ing via a mo­bile de­vice, while 57 per cent have used a mo­bile app.

Ac­cord­ing to the sur­vey, 32 per cent of the UAE bank­ing pop­u­la­tion are fre­quent users of bank­ing via an app on their mo­bile de­vice, us­ing it at least once a month. Ap­prox­i­mately, 39 per cent use online bank­ing via their mo­bile de­vice once a month.

The sur­vey said 36 per cent of UAE bank­ing cus­tomers be­lieve that their main fi­nan­cial in­sti­tu­tion of­fers good mo­bile bank­ing, while 38 per cent be­lieve that it al­ways of­fers the most up-to-date tech­nol­ogy.

The RFi re­search shows that the UAE pos­sesses a large smart­phone pen­e­tra­tion level, with 97 per cent of UAE phone own­ers hold­ing smart­phones. About 17 per cent of the UAE pop­u­la­tion sur­veyed would pre­fer to pay a bill via an app us­ing a mo­bile phone in the first half, up from 15 per cent in the sec­ond half of 2014. It fur­ther said 17 per cent would pre­fer to trans­fer money to a fam­ily mem­ber or a friend this way, up from seven per cent in the sec­ond half of 2014.

Ab­dulla bin Kha­laf Al Otaiba, se­nior man­ag­ing di­rec­tor of global re­tail and com­mer­cial at Na­tional Bank of Abu Dhabi, said mo­bile bank­ing is far more ef­fi­cient than tra­di­tional branches. Per­haps, most im­por­tantly, mo­bile bank­ing has the po­ten­tial to be a game-changer in terms of cus­tomer ser­vice. He said tech­nol­ogy is chang­ing the very def­i­ni­tion of ser­vice and mo­bile bank­ing helps to im­prove the ser­vice and re­la­tion­ship be­tween a bank and its cus­tomers.

"We have re­cently launched mo­bile bank­ing in May 2015. It is ex­pected that global mo­bile bank­ing users and us­age will ex­ceed 1.75 bil­lion in 2019, rep­re­sent­ing 32 per cent of the global adult pop­u­la­tion," Al Otaiba told media.

"To­day, the UAE stands at the fore­front of mo­bile bank­ing in­dus­try be­ing among the high­est in the world in terms of pen­e­tra­tion. The NBAD mo­bile bank­ing ap­pli­ca­tion is a re­sult of long and ex­ten­sive re­search and de­vel­op­ment. We ex­pect it to be among the most pop­u­lar mo­bile bank­ing apps in the mar­ket."

A pres­sure to­wards change in dis­tri­bu­tion chan­nels is oc­cur­ring at the global level, with a clear trend away from branch chan­nels and to­wards dig­i­tal chan­nels and call cen­tres. The branch chan­nel has dropped from 73 per cent of ap­pli­ca­tions world­wide prior to 2011, to just 60 per cent in the last year, while us­age of dig­i­tal chan­nels for ap­pli­ca­tions has al­most dou­bled, from 19 per cent to 37 per cent, ac­cord­ing to RFi's re­search.

This global shift has come about with the help of the pro­lif­er­a­tion of mo­bile dig­i­tal de­vices such as smart­phones and tablets, as well as the dig­i­tal na­tive gen­er­a­tion, help­ing to push the bound­aries of dig­i­tal up­take and ex­ert­ing a strong in­flu­ence over how banks dis­trib­ute their prod­ucts to con­sumers. Ac­cord­ing to the RFi study, con­sumers in the UAE has a high level of trust in new pay­ment tech­nol­ogy, a high level of in­ter­est in us­ing new types of pay­ments and are more likely to be able to en­vis­age a cash­less world. These find­ings sug­gest that the UAE is primed for adop­tion of al­ter­na­tive pay­ment meth­ods, in par­tic­u­lar dig­i­tal wal­let.

"At Emi­rates NBD, ap­prox­i­mately 80 per cent of the trans­ac­tions are al­ready per­formed via dig­i­tal and di­rect chan­nels such as online, mo­bile, ATMs and call cen­tre. As a re­sult of our in­te­grated mul­ti­chan­nel ap­proach to op­ti­mise our chan­nel mix and im­prove the ser­vice to our cus­tomers, this per­cent­age has been grow­ing over the last few years," Pe­dro Car­doso, head of mul­ti­chan­nel and CRM at Emi­rates NBD, said. "We aim to reach 90 per cent of to­tal trans­ac­tions out­side the branch though var­i­ous con­ve­nient chan­nels in the next three years, if not be­fore.

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