Interview with Mr. Urooj Ul Hasan Khan — ACA, CFA (GM & Head Investment Banking & Shariah Advisory Meezan Bank Limited)
PAGE: Tell me something about yourself, please:
Urooj Ul Hasan Khan: I am a Chartered Accountant from the Institute of Chartered Accountants Pakistan (ICAP) alongside holding a charter from the CFA Institute (USA) and Chartered Institute of Management Accountants (UK). I joined Meezan Bank Limited in 2008 and currently holding the position of General Manager and Head of Investment Banking & Shariah Advisory group. My core responsibilities include managing Investment banking business origination, monitoring, execution and delivery of deals including project financing, syndications, mergers & acquisitions, debt / equity offerings, financial and Shariah advisory services etc. I have previously worked at PWC Pakistan where we were involved in providing assurance, risk management and financial advisory services to various local/multinational banks.
PAGE: Creating better digital experiences for banking sector consumers is of paramount importance. What is your take on it?
Urooj Ul Hasan Khan: Banking industry is continuously evolving its landscape due to cutting-edge competition as well as rising customer expectations have become a general thumb rule to adapt to be digital in almost every industry including banking and financial institutions. This is why many most of the banks are upgrading their systems and practices e.g. providing digital banking solutions to keep up with the new trends to tend to their customers’ requirements promptly.
Nowadays, creating better digital experience for banking customers is an important aspect of every strategic approach to meet the demands of customers. Not only Banks but many other financial institutions also need to be digitally transformed to deliver a persistent banking experience whether it is online or retail.
Some proactive banks have made noticeable cost and resource investment in digitalization and industry has witnessed its results in the form of reduced costs, better and efficient response time and streamlined processes etc. This end-to-end integration also helps provide an engaging customer experience in financial services and allows business transformation with Artificial Intelligence.
PAGE: Tell me about the use of telecom services in Meezan Bank:
Urooj Ul Hasan Khan: Founded with a Vision to establish ‘Islamic banking as banking of first choice…’ has now grown to become one of the largest banking networks in the country with 902 branches in 290 cities.
Meezan Bank is a big consumer of telecom services. Some of these services are:
– When customers perform their financial transactions a real time notification is sent to the customers through SMS. The bank also uses telecom services for sharing awareness messages to its customers over SMS. For various financial transactions, one-time passcodes (OTP) messages are also sent through the use of telecom services.
Few major telecoms services being used by Meezan Bank are listed below:
– Automated IVR Call for awareness messages
– Automated IVR Call for transaction verification
– Connectivity of distribution network (Branches and ATMs) – over Fiber/ 3G/ 4G/ VSat/ DSL/ Radio
– Internet Connectivity
– Secured connectivity for POS network
PAGE: Are Pakistani banks leaders in digitalization in banking through investment and innovation?
Urooj Ul Hasan Khan: This is a tricky question. If you look at Pakistan’s banking industry, you will notice that forces such as changing payments landscape, competition from fintech, and arrival of mobile money services through telecoms are pushing banks to accelerate towards digital transformation but yet Pakistani banks are not leaders in digitalization. Though few banks have invested in digital transformation and refined alternate distribution channels and introduced digital banking solutions to its customers but there is much more to be done and a long way to go for being a digitally transformed banking industry.
However, in January 2022, the State Bank of Pakistan has issued licensing and regulatory framework for digital banks whereby it aims to issue 4-5 licenses for setting up digital banks in Pakistan. There shall be two types of digital banks; (i) Digital Retail Bank, which may deal with retail customer segments and (ii) Digital Full Bank, which may deal with corporate, commercial and retail customer segments. These digital banks will aim to promote financial inclusion, affordable and cost effective digital financial services and developing digital eco system. The establishment of digital banks, will of course require huge investments for acquiring and adopting digital infrastructures to offer products through digital platforms. With the setting up of digital banks, the traditional banks will be pushed further to make substantial investments in digital infrastructure and transformation at a more-faster pace to compete in the banking industry.
PAGE: How could digital transformation in the banking sector be further accelerated?
Urooj Ul Hasan Khan: Today, we see a lot of emphasis and give too much importance to our smart phones. Everything we do, is now concentrated in our hand-held mobile phones. In order to accelerate digital transformation, banks need to innovate products and services and provide ease to use digital platforms that can be simply accessed across multiple devices mainly via smartphones. An important consideration for accelerating digital acceptability from end user is the data security in banking and financial services. Customers want to feel secure in sharing the information and data with the banks.
Innovation in data collection, analytics and channel strategies shall enable the banks to diversify means of engaging customers and building better customer relationship through real time assistance with the help of digital platforms.
PAGE: Traditional banks are not known for their expertise in digital technology. How would you comment?
Urooj Ul Hasan Khan:Â There was an era of branch-centricity and deposit banking. The sales and services relied on branch network. Therefore, banks invested heavily in branch expansion and enhanced customer experience at branch level. The operations were mostly product-centric and direct channels were the priority for the traditional banks. Internet banking and ATMs were used to complement the branch centric operations.
Currently, this is an era of customer-centricity and transaction banking. Though branches still play a crucial role but the emphasis is shifting towards omni channel experiences. However, few traditional banks have not made considerable investments towards acquisition of digital technology, platforms and hence have no expertise in digital technology and no efforts were made towards digital transformation. Traditional banks need to take digital transformation as pure business model to accelerate digital transformation. With the cut-throat competition from fintech and telecom companies, if traditional banks do not take strategic decisions for adopting to go digital, the risk of losing substantial banking share is knocking at their doors.