Complaining about banks became more fashionable after the 2008 financial crisis. But in recent years, our contact with banks has diminished, thanks to the rapid introduction of technology that has allowed us to dispense altogether with visiting them or even speaking to them.
The number of times most of us have found ourselves shouting at the other end of a line to banking personnel has lessened greatly. Consequently, most have found that their blood pressure has improved in recent years. The trend is likely to continue.
So let’s give credit where it is due, and I am not talking about a loan with favourable interest rates. UAE banks have embraced technology with gusto.
Going digital has been a win-win situation for banks. Customers get convenience and speed, while banks save money. About 800 million customers globally use mobile banking, and that is expected to more than double to 1.8 billion users by 2019, according to the auditing firm KPMG.
And the UAE is at the forefront of the digitisation drive. With a population of 9.2 million, it has the highest usage of smartphones in the world, with penetration rates at about 7 per cent, according to a recent Google study. And even though cash has been traditionally prized over cards in this part of the world, many traders and consumers are increasingly being won over by the ease of cards and digital payments.
Banks have not missed the opportunities. The UAE Banks Federation launched this year its mobile wallet project after receiving the green light from the Central Bank. The initiative, announced in February as part of the country’s push to go digital, will allow bank customers to make payments with their mobile phones in a number of ways, including through SMS and phone-swiping technologies.
“Smartphone penetration in the UAE is one of the highest in the world at 78 per cent, and internet penetration is more than 75 per cent, so we clearly live in a country where online mobile banking will rapidly become the preferred banking preference for customers,” said Suvo Sarkar, the head of retail banking at Emirates NBD, Dubai’s biggest bank.
In a region where personal relations are highly prized, banks have often prided themselves on the size of their branch networks and managers who are available to chat over a cup of tea.
But increasingly, consumers have shown a preference to get their banking needs done remotely through the internet to avoid traffic, parking and queues. By going digital, the customer has much less of a headache and the bank is able to become more nimble by freeing up more people, or letting them go altogether, as the amount of things you can digitally do expands.
“Any organisation today has to be fit,” Jamal bin Ghalaita, the chief executive of Emirates Islamic, told The National last month. “Fit means you have to keep your costs at bay because customers can go to the internet and see the price of everything – price of banking, price of commodities. So we have to be more digital to keep our costs down.”
Can you remember the last time you went to a bank? Neither can three of my colleagues who sit next to me in the office.
Just about every basic banking transaction you can think of, such as transferring cash and investing in a bank product or setting up recurring payments, can be done remotely. Even loans can be applied online at some banks and this will accelerate once the newly launched Credit Bureau gets into full swing. Even the need for physical signatures on a bank document will become a thing of the past when digital signatures are adopted.
Going digital, however, has not come without its problems. While banks often tout their customer service as their main selling point, their back offices have not kept up, meaning that customer problems cannot be resolved quickly, according to the consultancy Capgemini.
Even as banks become more digitally inclined, measures of customer satisfaction have not gone up proportionately. In its 2015 World Retail Banking report, Capgemini said a steep drop in rankings of the UAE made the Middle East register the biggest regional drop. The UAE Customer Experience Index fell by 8.3 points to 64.7 this year from its 2013 score, leaving it behind Saudi Arabia and South Africa.
The problem with customer satisfaction is to some degree self-induced.
Banks make a song and dance about how great and wonderful they are at meeting all the needs of their clients, making token gestures to the enormous profits they make from products such as credit cards with inducements like “loyalty points” (which has been shown to only get gullible consumers to spend more).
Meanwhile, things like getting your address corrected can sometimes result in premature balding.
Maybe bank bashing will live on for longer than I think.
Mahmoud Kassem covers banking and finance for The National
