Banks need new and innovative ways to retain customers. That’s just the way the world is now. They aren’t any different from other service providers, but banking has been disrupted more than most.
Aspects like Enterprise, Customer Relationship Management and Customer Retention techniques cannot afford to be vague in a customer’s connected sphere. If a customer is connected to their house and their car, why should they not be real-time connected to their money? The same logic also applies for Zimbabwean banking clients.
So how has local banking tech changed?
Contrary to prevalent belief or impression, a sizeable number of banks, even the closed ones, had some remarkable remote banking solutions for their time, even as early as 2005, before the emergence of disruptive technologies like EcoCash.
Trust bank developed a VPN modelled Bank@EASE Internet banking solution before the money-burning days. CABS had one of the most popular internet banking systems during the burning era (remember Chuweb). Allied Bank (ZABG) had one of the very first SMS Banking solutions going into the multi-currency era, catering for feature phones dominant at that time, allowing almost all of the transactions available today.
In the last 5 years, some banks have rushedly started to roll out solutions after the introduction of EcoCash to ring-fence their customers by giving them alternatives. A sample of Internet platforms is evidence that most of them were developed by one provider or were simply copied across banks with no added innovations.
One would get the impression that having a mobile phone or internet banking solution was more fashionable for a bank than useful for the customer. Two tell-tale signs are the virtual keyboard and the one-time password security protocols, both of which were very inconvenient to the extent of killing the products.
Going into 2010 and beyond, Cellulant gave Safaricom and the world MPESA modelled Mobile Money. Banks, MNOs and Financial service providers were the very first to be engaged in introducing Mobile Money into Zimbabwe. However, perhaps because of structural advantages, it was the MNOs that ran to market first with finished products.
201o saw the launch of Telecel’s Skwama as a pioneer. The result was a scramble by both MNOs and banks building mobile banking solutions that were dependent on Mobile Network Operators’ USSD platform. This led to the 2013 showdown between the Bankers Association of Zimbabwe and Econet and by extension Steward Bank, mainly because Econet would not liberally share its infrastructure, especially with a more or less competing product.
Where does this leave us?
While regionally FNB bank is reported to be rolling out its own mobile network, and Barclays has introduced NFC e-commerce, very few banks in Zimbabwe have innovated beyond the USSD technique that is EcoCash (Before the new EcoCash App) even to this day. Barclays Zimbabwe became one of the first banks to launch a mobile app with the Barclays app and since then only CABS has had a go at it with their CABS app.
It is not generally clear why banks will not go beyond the ATM card to introduce innovation in banking. Just to be clear here, I’m not talking about importing an Indian developed solution that fits our needs like a passed on pair of shoes. Such solutions are both expensive and difficult to implement.
A custom, possibly locally make answer to a problem that is existent in Zimbabwe is what we need. Research and Development indeed could be expensive but all resources pulled together in the same manner they did with the introduction of Zimswitch, a lot of mileage could be covered in introducing solutions that prove banks relevant.
Almost all banks, with the exclusion of Agribank, have a mobile solution that can conduct airtime top-up and internal transfers. A few more can do ZIPIT transactions but only Barclays offers RTGS via mobile phone. Standard Chartered bank has a mobile banking solution that has no transfer options at all, whilst NMB does not even have mobile banking. Critical about these solutions is the fact that they only carter and serve the banked population with no direct incentives for the unbanked.
The majority of Zimbabwean banks, with a few exceptions, offer internet banking with the basic funds transfers, statements download, bill payments and sending of banking instructions. CABS and Standard Chartered go on to offer SWIFT telegraphic transfers. MBCA offers bulk payments which can be an alternative for processing salaries for a small organisation in place of Paynet.
Recently, ZB Bank adopted the agent banking model that will introduce banking facilities beyond the brick and mortar branches. This, however, seems more targeted at complimenting their ZESA PowerPlus retailing than really offering a banking channel. Steward Bank introduced this model first to offer cash withdrawals and deposits, again a model somewhat servicing their EcoCash’s treasury and liquidity requirements.
What are we looking forward to?
Where is biometric registration and recruitment, a solution that could introduce banking to farmers? Where are the banks in the transactions in commuter omnibuses? Some solutions can eliminate the change problems. Where are the banks in real estate, in bill presentation and collection, schools, tertiary education? As long as we keep asking these questions, we can be sure that financial services will continue to be provided by third parties at a premium.
If there’s no use of tech on a large scale its easy to see why EcoCash and the rest of the mobile money mafia deserve to go after the bankers’ lunch after all.
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3 comments
Good valid concerns you raise there. You seem to vindicate what eco-cash challenged the Banks to do – innovate and survive. Part of the solution is for banks to first realise that IT Department has moved from just a support unit to a driver and strategic business unit for any serious organisation. Which raises the question. How much are these banking institutions investing in human capital at large and specifically IT related?The impact of disruptive technologies and innovation has been felt across all traditional industries (worst hit being print media). It’s time our local institutions accept it and adapt.
you seem to have ignored Stanbic Bank. they have Stanbic blue 247 which is supplied by Cellulant and they have an app by the same name which can be downloaded on Google playstore.
The solutions you talk about on serving the unbanked will depend on MNO opening up their networks to these kind of arrangements where internetwork transfers and transfers between account mumber of any bank and mobile number of any network are possible. perhaps the regulators can consider legislation in this regard at the same time they are looking at infrastructure sharing. I would say cabs had or has a better offering than ecocash but ecocash ran away with it because of their financial muscle. even the human resource that pioneered ecocash was mainly poached from cabs (unverified sources).
this trend is not peculiar to zim but the world over these disruptors have changed the face of banking… at least as we used to know. one catch phrase these days is- banking is nolonger a place that you go but something that you do.
brilliant article.
This is one of those provocative articles which is necessary for looking at where we’ve come from and what we have or haven’t achieved. Only addition i have is that Stanbic is also offering a mobile banking app.
great article!