- Digital banking dynamics empowering customers through technological integration
Interview with Mr. Faizur Rehman — Group Head of Information Technology Meezan Bank
Profile:
Mr. Faizur Rehman is an IT professional with a business smarts attitude, the ability to manage technology and deliver solutions that add value to the bottom line of the organisation. Dynamic and accomplished Information Technology professional with more than 30 years of experience in Information Technology.
Faiz ur Rehman is an MBA with bi-majors in Operations Management and Finance. He is also amongst the very few Certified Software Quality Professionals in Pakistan. He brings with him versatile experience in the manufacturing sector, management companies, traders, distribution companies and especially the financial sector (DFIs, Modarabas, Leasing, Housing Finance and Commercial & Investment Banks). His last assignment was at Zensoft Private Limited an information technology solution provider company part of the renowned Ghulam Faruque Group of companies where he was the General Manager.
Prior to that, he was the Senior Vice President and Head of MISD in Bankers Equity Limited. He also worked for Systems Research (Private) Limited as a Project Manager, started his career at Jaffer Brothers (Private) Limited.
At Meezan Bank, he is responsible for planning the current and future strategies of the information technology division in line with the banks strategic plans, also responsible for managing implementation, customisation and 24×7 support of the integrated banking and remote banking solutions. Managing a portfolio of projects and delivering technology solutions that improve business performance. Skilled at organising people, processes, and systems into a coherent solution.
PAGE: It is presumed that in the steeply evolving digital landscape, technology has become pivotal for delivering gorgeous services to customers in the banking sector. Please elaborate with details.
Faizur Rehman:Â Certainly, in the rapidly evolving digital landscape, technology plays a pivotal role in delivering enhanced and seamless services to customers in the banking sector. Here are specific details illustrating the importance of technology in shaping the customer experience:
1- Digital banking platforms
Mobile banking apps: Banks are investing heavily in intuitive mobile apps, allowing customers to perform various transactions, check balances, and manage accounts on the go.
Internet banking: Robust online banking platforms provide users with secure access to their accounts, enabling fund transfers, bill payments, and account monitoring.
2- Customer-centric solutions
Personalised services: Advanced analytics and machine learning enable banks to analyse customer behaviour, preferences, and transaction history, offering personalised product recommendations and targeted services.
Chatbots and Virtual Assistants: AI-powered chatbots enhance customer support by providing instant assistance, answering queries, and guiding users through various banking processes.
3- Digital payment solutions
Contactless payments: Integration of contactless payment methods, such as NFC-based transactions and mobile wallets, simplifies and speeds up the payment process for customers.
QR Code payments: The introduction of QR-based payment solutions offers a convenient and secure way for customers to make payments using their smartphones.
4- Blockchain and fintech integration
KYC processes: Incorporating blockchain technology in Know Your Customer (KYC) processes enhances security and streamlines customer onboarding.
Collaboration with fintech: Partnerships with fintech companies enable banks to leverage innovative solutions for digital lending, investment, and financial planning.
5- Enhanced security measures
Biometric authentication: Integration of biometric authentication methods, such as fingerprint and facial recognition, ensures secure access to accounts and sensitive information.
Fraud detection systems: Advanced fraud detection algorithms and real-time monitoring systems identify and prevent fraudulent activities, safeguarding customer accounts.
6- Efficient operational processes
Automation and AI: Implementation of Artificial Intelligence (AI) and automation streamlines internal processes, reducing manual efforts, minimising errors, and enhancing overall operational efficiency.
Robotic Process Automation (RPA): RPA is employed to automate routine, rule-based tasks, freeing up human resources to focus on more complex and value-added activities.
7- Digital transformation initiatives
Cloud computing: The adoption of cloud services enhances scalability, agility, and cost-efficiency, allowing banks to rapidly deploy new services and applications.
Data Analytics: Advanced data analytics tools enable banks to gain insights into customer behaviour, market trends, and operational performance, facilitating informed decision-making.
8- Innovative customer interaction channels
Social media engagement: Banks utilise social media platforms for customer engagement, marketing, and real-time communication.
WhatsApp banking: Integrating banking services with widely used messaging platforms enables customers to check balances, download statements, and access services through familiar interfaces.
9- Continuous development and improvement
Agile development practices: Agile methodologies enable banks to adapt quickly to changing customer needs, implement updates, and roll out new features in a timely manner.
User feedback loops: Regularly gathering and incorporating customer feedback ensures that digital services align with customer expectations and preferences.
In summary, the integration of technology in the banking sector transforms the customer experience by providing convenience, personalisation, and security. The ongoing evolution of digital banking services reflects a commitment to meeting the dynamic needs of customers in the modern era.
PAGE: To stay competitive, banks must leverage the power of innovative technologies to enhance customer experiences, optimise operations and drive growth. What is your standpoint on it?
Faizur Rehman:Â I agree with the statement that leveraging innovative technologies is crucial for banks to stay competitive in today’s dynamic landscape. Here’s my standpoint on the significance of adopting innovative technologies in the banking sector:
1- Enhancing customer experiences
— Innovative technologies enable banks to offer personalized and seamless customer experiences.
— Mobile apps, AI-driven chatbots, and self-service portals enhance accessibility and responsiveness, contributing to overall customer satisfaction.
2- Optimising operations
— Automation, AI, and data analytics streamline internal processes, reducing operational costs and enhancing efficiency.
— Robotic Process Automation (RPA) can handle routine tasks, freeing up human resources to focus on strategic and complex activities.
3- Driving growth
— Embracing fintech partnerships and integrating with innovative solutions allows banks to tap into new revenue streams.
— Digital lending platforms, investment tools, and fintech collaborations contribute to expanding the range of financial products and services.
4- Agile adaptation to market trends
— Technology enables banks to quickly adapt to changing market trends and customer preferences.
— Agile development practices facilitate rapid deployment of updates, ensuring that banks remain responsive to evolving demands.
5- Data-driven decision making
— Advanced analytics and machine learning empower banks to make informed decisions based on data insights.
— Predictive analytics aids in identifying market trends, customer behavior, and potential risks, supporting strategic decision-making.
6- Cybersecurity and risk management
— Investing in cybersecurity technologies is essential to protect sensitive customer data and maintain trust.
— Advanced risk management systems leverage AI to detect and mitigate potential threats, ensuring a secure banking environment.
7- Meeting regulatory compliance
— Technology assists banks in staying compliant with evolving regulatory requirements.
— Blockchain and digital identity solutions enhance transparency and accountability, contributing to regulatory compliance.
8- Innovation in financial products
— Blockchain and smart contracts enable the creation of innovative financial products, such as decentralised finance (DeFi) solutions.
— Digital wallets, contactless payments, and cryptocurrency integrations offer customers diverse and modern financial options.
9- Sustainability initiatives
— Technology supports banks in adopting sustainable practices, such as paperless transactions and energy-efficient operations.
— Fintech partnerships may facilitate the development of green financial products that align with environmental sustainability goals.
10- Competitive edge in the market
— Banks that embrace and invest in innovative technologies gain a competitive edge over those that lag in digital transformation.
— Continuous innovation helps banks stay ahead in the market, attract tech-savvy customers, and build a reputation for cutting-edge financial services.
In conclusion, embracing innovative technologies is not just an option but a necessity for banks to thrive in an ever-evolving financial landscape. The strategic use of technology enhances customer satisfaction, operational efficiency, and overall competitiveness in the banking sector.
PAGE: It is widely believed that global banking IT spending is projected to reach $761 billion by 2025. How would you comment on it?
Faizur Rehman:Â The projection that global banking IT spending is expected to reach $761 billion by 2025 highlights the significant and growing investment in technology within the banking sector. Some comments on this projection:
1- Digital transformation emphasis
The substantial increase in IT spending reflects the banking industry’s strong emphasis on digital transformation. Banks are strategically investing in technology to modernize their infrastructure, processes, and services.
2- Adoption of advanced technologies
The projected spending indicates a shift toward adopting advanced technologies such as artificial intelligence, machine learning, blockchain, and cloud computing. These technologies play a crucial role in enhancing operational efficiency and customer experiences.
3- Cybersecurity prioritisation
As the banking sector continues to digitise, there’s a heightened focus on cybersecurity. A significant portion of the IT spending is likely allocated to strengthening cybersecurity measures to protect against evolving cyber threats.
4- Customer-centric innovation
The investment suggests a commitment to developing customer-centric solutions. Banks are likely allocating funds to create innovative digital banking services, personalized experiences, and seamless omnichannel interactions to meet evolving customer expectations.
5- Regulatory compliance investments
The banking industry operates in a highly regulated environment. The projected spending reflects the ongoing efforts to invest in technologies that ensure compliance with regulatory requirements, including data privacy and security standards.
6- Infrastructure Modernisation
Legacy systems can be a hindrance to innovation. The projected spending may include initiatives to modernise existing infrastructure, migrate to cloud-based solutions, and adopt agile development practices to enhance flexibility and scalability.
7- Fintech collaboration
Banks are increasingly collaborating with fintech partners to stay competitive and bring innovative solutions to market. Some of the IT spending might be allocated to strategic partnerships, investments, or acquisitions to harness fintech capabilities.
8- Data Analytics and insights
The growth in spending signals a recognition of the value of data. Banks are likely investing in advanced analytics tools to derive actionable insights from vast datasets, aiding in strategic decision-making and personalized customer engagement.
9- Resilience and business continuity
Recent global events have underscored the importance of resilience and business continuity. IT spending may include investments in technologies that ensure uninterrupted operations, disaster recovery, and remote work capabilities.
10- Future-proofing strategies
The substantial projection indicates that banks are taking a proactive approach to future-proofing their operations. They are likely investing in technologies that not only address current challenges but also anticipate and adapt to future industry trends and disruptions.
In summary, the projected growth in global banking IT spending reflects a strategic response to the evolving landscape, with a focus on technology-driven innovation, cybersecurity, compliance, and customer-centricity. It underscores the pivotal role of technology in shaping the future of the banking industry.
PAGE: Is it true that integrating new technologies with existing systems is one of the top challenges in implementing digital transformation initiatives?
Faizur Rehman:Â Yes, it is true that integrating new technologies with existing systems is often cited as one of the top challenges in implementing digital transformation initiatives. Several factors contribute to the complexity and difficulties associated with technology integration:
1- Legacy Systems
Many organisations have legacy systems that were developed and implemented years ago. These systems may lack the flexibility and compatibility required to seamlessly integrate with modern technologies.
2- Interoperability issues
New technologies often need to work cohesively with existing systems, and achieving interoperability can be challenging. Ensuring smooth communication and data exchange between different systems is crucial for a successful integration.
3- Data migration challenges
Transferring data from legacy systems to new platforms can be a complex process. Data structures, formats, and storage mechanisms may differ between systems, requiring careful planning and execution to avoid data loss or corruption.
4- Vendor lock-in
Organisations may face challenges when integrating technologies from different vendors. Vendor-specific protocols and standards can create dependencies, leading to potential lock-in issues and limiting the organization’s flexibility.
5- Cultural resistance
Employees and stakeholders may resist changes to established workflows and processes. Overcoming resistance to adopting new technologies and methodologies is a critical aspect of successful integration.
6- Security concerns
Integrating new technologies with existing systems can introduce security vulnerabilities. Ensuring that security measures are robust and that sensitive data remains protected throughout the integration process is a paramount concern.
7- Skill gaps
Implementing new technologies may require skills that are not currently present in the organisation. Bridging skill gaps through training or hiring can be necessary for effective integration.
8- Cost considerations
Integration efforts often incur costs related to software customisation, data migration, and training. Balancing the investment in integration with the expected benefits is a crucial aspect of digital transformation planning.
9- Project complexity
The complexity of integrating multiple systems, especially in large organisations with intricate infrastructures, can lead to project delays and an increased likelihood of unforeseen challenges.
10- Strategic alignment
Ensuring that the integration aligns with the overall business strategy and goals is essential. Poor alignment can lead to fragmented systems that hinder rather than support the organisation’s objectives.
While integrating new technologies poses challenges, overcoming these obstacles is essential for organisations looking to stay competitive and leverage the benefits of digital transformation. It requires careful planning, a clear understanding of existing systems, collaboration among stakeholders, and a commitment to addressing the various complexities involved.