Standard Chartered, EastWest on the blueprint for building the bank of the future

Data is the new oil, says Sarabjit Anand, Standard Chartered’s CIO for Singapore and ASEAN.

Just going digital isn’t a guarantee for success—rather, it is built up by wielding the proper tools, working with the right talent, and properly making use of data.

This is the key point that leaders and experts in the financial industry said in order for banks, fintechs, and financial institutions to build a resilient, future-ready bank amidst an era of rapid digital change, in the webinar Blueprint for Success: Building the Resilient Bank of the Future, co-hosted by Oracle and the Asian Banking & Finance on 7 May.

In the opening presentation Sarabjit Singh Anand, Standard Chartered’s CIO, Singapore and ASEAN markets (Malaysia, Vietnam, Thailand, & Rep Offices) laid out four key areas that will empower the bank of the future: cloud, API, data, and of course, people.

“Data is the new oil,” Anand told attendees. “[And] it's not just the data which has the power. It's the data combined with the tools which are available in the marketplace, which you can then effectively use to convert into information. That's really where the power of data starts to play a role.”

He noted how just like how oil was one of the cornerstones in driving the industrial revolution during the 19th century, data now plays a major role in driving the future of banking activities and refining customer journey.  “What can you do with this data? How can you improve your offering to your clients?” Anand asked.

For example, StanChart has real-time offers and deals for their credit card clients, offered thanks to their machine learning capabilities. The bank also can make predictions on traffic and demand, such as onboarding predictions, in order to analyze their current and future performance.

Standard Chartered also offers algorithmic lending options in their business banking space, working with external partners to create such solutions, amongst others.

But more than that, what Anand considers as any bank’s cornerstone when upscaling operations is the people. “The cornerstone for [our] success on digital transformation is our people. And we are committed to continuously upskilling, rescaling our technologists and staff so that we make them future-ready.”

Partnership & Collaborations
For Asif Saleem, Oracle’s Banking Innovation Advisor for JAPAC, the modern banking ecosystem is all about partnerships and collaborations.

Saleem notes that rapid changes in the banking space over the next two years will see banks having to go beyond offering basic financial needs such as loans, mortgages, amongst others, but offering services that are part of a consumer’s daily routine.

“The modern ecosystem is all about partnerships and collaboration,” Saleem said. “To be able to offer these services--in which a consumer of yours is basically experiencing [it] from a daily routine perspective, say by ordering groceries, to watching their favorite movie on Netflix, or listening to their favorite music on Spotify--you need to have a modern architecture, which is basically driven by cloud native technologies.

“All of this will only happen when you properly leverage the power of cloud, and along with a stronger Machine Learning and Digital Analytics algorithm, which will help you understand your consumers better, and having a 360 degree view to be able to focus towards fulfilling the overall consumer needs. This is to me, basically, about enabling the platform of the future,” he added.

Having worked with over 600 banks in the development of their data systems and digital processes, the software and data systems company Oracle have gained the insights and experience needed to help other banks and financial players in their digitisation journeys, adds Andre Wenas, Director and Cloud Architect for Oracle.

Erosion, Reselling
A bank’s worst nightmare is for it’s customer base to erode, and with the pandemic having sped up customers’ adoption of digital banking platforms, going digital is a requirement even for banks outside of global financial centres, said Rick Pusag, CIO and Head of Business Operations for EastWest Bank in the Philippines.

However, he warned that for a country such as the Philippines, a purely digital-only bank may encounter difficulties in maintaining stable operations in the long run.

“I think from a servicing perspective, they (digital banks) may find it easier, right? Because traditionally, their onboarding practices are somewhat more simplified than some of the more brick and mortar organizations,” he said.

“But I think where they may have challenges is if they're purely a digital bank. How do they then take the money and invest in order to then pay off the common interest rates that are offered to customers?”

Referring to a local neobank debutant offering high interest rates, Pusag notes that it remains to be seen how the digital bank will make itself profitable. “I think it remains to be seen as to how they will end up really making that money. We've got a recent entrant where the interest rate is significantly high. And the question is, for how long are they going to be able to maintain that?” he asked.

Incumbents are not just staying on the sidelines either, and Pusag shared how EastWest Bank has begun introducing new services locally outside of the traditional financial services. These include a service where they let their banking customers pre-book some of their transactions in advance in order to just pick-up the items, or book a time slot when visiting a retail store, so that they don’t have to wait in line.

A vehicle selling platform is also in the works, in which EastWest will sell repossessed cars from loan clients who had to let go of their cars due to being unable to continue payments.

“We are creating a marketplace where consumers can quickly select vehicles that match their requirements and financial capacity to pay. Whereas in the past, those [vehicles] were mostly sold through ads, and through Excel spreadsheets,” he shared.

If you wish to read more about this topic, check out Oracle's report, "Banking on the Data Advantage: How banks can transform data challenges in opportunities" accessible here.