Tech-savvy customers are pushing First National Bank (FNB) to the limit, driving the bank to come up with digital innovations that are boosting profitability at the financial services provider.
This is according to Jacques Celliers, FNB CEO, in an interview with ITWeb. “The nice thing is we have a very sexy client base. If you don’t have customers that push you, we will not be able to deliver cool stuff. We are grateful that our customers are tech-savvy; if we make mistakes, they catch you out.”
FNB recently rescinded its decision to introduce a new password policy that required users to type in their usernames and passwords manually for online banking rather than using their browser or password manager to automatically fill in the fields.
This after hundreds of consumers turned to social media to voice their frustration with the new rules, which resulted in several consumers being locked out of their accounts.
“We have invested millions in our digital drive. Besides investing in actual ICT solutions, we have over 3 000 people developing and coding for us. Technology is a massive expense for our business. Everything we do is digital; we don’t have analogue anymore, it’s all digital. It has been an exciting journey,” Celliers said.
Digital interface
Celliers was speaking after FirstRand, whose portfolio includes FNB, Rand Merchant Bank and WesBank, said yesterday it grew its profit 5% to R29.4 billion in the year, buoyed by a strong performance from FNB.
According to the bank, a consistent strategic focus on cross-sell and up-sell to existing clients resulted in an uplift in deposit and lending volumes, with customer numbers at 8.2 million.
Commenting on the results, Celliers said: “Our digital interface continued to offer us fresh growth opportunities, with app logins topping 45.5 million in June this year.
“Sales and client interactions continue to grow on our digital platforms and we are delighted clients have embraced the opportunity to engage on these interfaces.”
The performance of FNB’s digital interface highlights its ability to shift client behaviour, Celliers noted.
According to FNB, its app transactions are up 45%. However, it points out that digital sales dominate the growth story, with insurance, FNB Connect and investment pillars all enabled on digital.
Branch modernisation
Commenting on closing branches as more customers get comfortable with digital channels, Celliers noted there won’t be any closures at FNB.
“There is a misunderstanding in the world about the role the branch plays. For example, at Uber, although there is an unbelievably reliable platform, zero customer service can be provided without the human. For every customer request at Uber, a human will be there.”
FNB’s competitor, Standard Bank, recently faced backlash after it closed 104 branches countrywide within a short space of time. To date, one in every five Standard Bank branches has been closed down.
“In our environment, whether you call our contact centre or visit our branch, or whether we visit you at your offices; whenever there is a need for a human, we will have a human being there to serve our customers using the most powerful tool available. We would want to see many more points of presence.
“When someone walks into our branch, we ensure the ability of the platform to identify the customer; to present the context to the customer, and we automate the whole experience.
“Branch closures are not part of our strategy. We are actually looking at modernising our branches. In fact, 80% of our sales are still happening in branches. So we are very excited about our branches,” said Celliers.
He believes the bank will be able to shrug off competition from the new digital entrants that have recently entered SA’s retail banking space. These include TymeBank, Discovery Bank and Bank Zero.
“Competition comes to us from all angles. The big guys at the moment are still our biggest competitors. They are the ones that keep us up the most,” he said.
“We believe the new players will gain momentum, and we are not pretending that they are not there. However, I am sure we will be able to respond to their offerings. FNB has been around for 180 years now, and over the years, there has been many entrants, so we are quite used to this, and we are also excited about the vibrancy in our industry.”
Celliers pointed out that FNB is also tapping into fintech to boost its business. The company recently partnered with start-up company Selpal to connect informal traders in townships with fast-moving consumer-goods companies.
FNB is seeking to tap into a market that it estimates could consist of as many as a million enterprises that have largely been ignored and fall into the “unseen economy”.
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