Having established a large digitally-active customer base, big-four bank FNB will maintain its investment in digital channels, including mobile USSD.
This was revealed by CEO Harry Kellan, in an interview last week following the release of the bank’s financial results for the six months to 31 December 2024.
In SA, FNB has a customer base of 9.8 million people. Of these, 7.4 million are digitally-active customers, according to Kellan. The 7.4 million is an uptick from the 7.1 million reported in December 2023, he said.
“In our personal segment, one of the things is acquiring the customers digitally, but you’ve got to get them used to the digital channels. USSD still exists and we still invest in our USSD, which is for feature phones.
“We measure app [use], but we also measure USSD and see how the customer take-up is. At some point, I’m expecting us to top out the penetration of digital into our customer base.
“We want to continue providing services for those 7.4 million customers that use us digitally. Whatever they do, we want to make it more convenient and easier for them. The investment in our platform and channels doesn’t stop because of penetration...they exist separately around that.
“We want to service all our customers, but we want to service them much more digitally. The reason for this…is about how efficient it becomes for them. Digital is the most efficient for customers.”
Kellan said total customer growth, including Africa, was up 3%. South Africa was up 2% in total customer growth, representing net active customers.
“Our volume of transactions, our volume in our digital channels in totality was up 12%. Just on the app itself, it was up 16%. The difference between the 12% and 16% is the online banking, USSD, etc.”
USSD remains an integral part of Africa’s digital ecosystem, with reports indicating that nine in 10 mobile money transactions in Sub-Saharan Africa still flow through USSD.
FNB’s growth, according to Kellan, is a sign of how the bank’s channels resonate with customers. “We continually focus on digital spend; we continually focus on our digital channels, making it much easier and more convenient for our customers.
“We also see e-wallet as part of our digital strategy, not just for financial inclusion, but in terms of convenience.”
Introduced by the bank in 2009, e-wallet has advanced to become a “pocket of money” – beyond the function of cash withdrawals. Users can also pay for electricity and load data on their phones via their e-wallets.
A breakdown of the e-wallet figures shows growth of 3%, stated Kellan. “The total e-wallets that we have, including to FNB customers, is 8.6 million. Even within FNB customers, they use 1.8 million of that. FNB customers who have transactional accounts with us or another relationship with us, 1.8 million of them use e-wallets for themselves as well.
“We are still looking to invest more in e-wallet, giving it more capabilities.”
Multifunction branches
The drive towards digital enhancement has also reached the bank’s branches, said Kellan, adding that the bank has taken a different approach to how these physical structures can be used to service customers.
Unlike its peers, which have closed many of their branches as more customers go digital, FNB has stood firm on the value-add of the traditional bank branch.
According to Kellan, the branch network is getting smaller, but providing services to customers remains important.
“The branch is not just a sales place anymore; it’s also a place to service customers. It’s sales and services in one.
“For example, when customers come into a branch, it is also to educate them about how to use the ATM to deposit money. It’s also to inform them that if they want to withdraw money, they don’t need to visit an ATM and can withdraw at the point-of-sale. It’s about making it much more convenient.
“We want to continue to convert customers from the physical to the digital, but we don’t want to charge them more for being digital. It should be much more convenient and cheaper for you to be digital.”
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