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DBS: The Best Digital Bank in The World?

Posted by Anna Mielczarek on 18-Sep-2018 07:30:00

In May, Southeast Asia’s largest bank, DBS celebrated its 50th anniversary by unveiling its new, refreshed brand identity.

Believing it was about time to introduce ‘a new kind of banking’ in order to stay relevant in the era of Digital Transformation, DBS has decided to replace its ‘Living, Breathing Asia’ slogan, which has been known to people for more than 10 years, with the new ‘Live more, Bank Less’ positioning.  

DBS-Bank
                          source: Elets Technomedia 
 

Live more, Bank less

The new positioning of the bank aims to show that DBS is committed to working doubly hard to enable its customers ‘simple, seamless and invisible’ experience of digital banking as stated by Karen Ngui, head of group strategic marketing and communications at DBS Bank in her interview with The Drum.

                                                  source: DBS YouTube Channel

Karen Ngui emphasises that DBS plans to become ‘digital to the core’ by investing in people and skills differently, re-architecting the bank’s technology infrastructure in the back end to be cloud-native, having systems and ways of working that shorten the release times of new applications, and enabling scalability through ecosystem partnerships. All these changes aim to transform DBS into more customer-centric bank. However, in order to do that, there’s a need for overturning bank’s approach to customer service by starting from their (customers') perspective, rather than the logic and limitations imposed by the systems and processes.

 

'World's Best Digital Bank'

DBS, the Asian bank headquartered in Singapore received global recognition in 2018 when it was awarded the title of ‘World’s Best Digital Bank’ and ‘World’s Best SME Bank’ by Euromoney. It is the first Asian and Singapore-based bank to win two awards in the global category at the prestigious Euromoney Awards for Excellence 2018. However, it is not the first time when DBS has been recognised for its digital efforts. In 2016, DBS has been named ‘World’s Best Digital Bank’ showing its leadership in digital banking.

'Quantifying exactly what digitalisation means for profitability – and it means plenty – is a useful tool not only for investors but the whole industry. The market is so impressed by what it has heard from DBS that it’s beginning to be revalued as a bank crossed with a tech stock.’ (Euromoney)

DBS is believed to be the first bank in the world to develop methodology focusing on measuring the financial value created by digitalisation. Utilising its digital value capture methodology, bank has been able to draw up an effective business plan aiming to drive digital behaviour among its customers by making it much easier to engage with the bank online.

As a testament to its Digital Transformation strategy, DBS has proven to improve its cost-income-ratio from 45.4% in 2015 to 43% in 2017. Also, revenues have increased by 10.4% over the same period. Meanwhile, the proportion of customers in Consumer and SME Banking in Singapore as well as Hong Kong that are described as digital rose nine percentage points since 2015 to 42% in 2018.

‘It is rare to find banks that offer comprehensive services to SMEs cross-border. Singapore is an exception, and DBS has made the greatest progress in our review period, taking the lessons it has learned in serving Hong Kong and Singapore SMEs and applying them in India, Greater China and Indonesia.’ (Euromoney)

 

What Made It So Successful? 

In case of DBS, digital pervades every area of the bank. Unlike other banks, DBS does not only focus on a digital front end so it has a fancy mobile interface but the rest of the bank’s operations are old technology. Instead, it is customer obsessed, data driven, willing to take risks and experiment, move from waterfall development to agile and become a learning organisation. And, it can be seen in services it provides to its customers such as DBS Home Connected.

'Mortgage banks look at a mortgage as a product while customers want the perfect home, so they are interested in schools, amenities, and are very emotionally involved in the process. So how can a bank help a customer in buying a home?’ (Sameer Gupta, Chief Analytics Officer at DBS)

Essentially, anybody using the app, not just DBS customers, can point a smartphone camera at a building and see useful information about prices, affordability, and schools. It offers an augmented reality view of nearby properties and amenities and allows you to save previous searches for comparison.

The bank’s share of Singapore mortgages grew from 24% when it started offering the house information to 32% in 2018.

Currently, DBS employs about 400 people in its analytics team and it is still growing, as said by Gupta. DBS initiative known as RED short for Respectful, Easy to deal with and Dependable utilises data and analytics throughout the bank. 

In HR department, it has helped reduce employee attrition by spotting early indicators in time to address issues. Analytics has reduced cash-outs at ATMs from every three months to none in 2017. In general, RED has helped to save 250 million customer hours and 1 million employee hours.

In terms of marketing efforts and its communication with customers, DBS has decided to move from sales to advice. And in order to positively impact, enhance, and expand thinking, the bank has used hackathons, human cantered design and customer journey thinking. It has also redesigned workspaces to be collaborative while offering private work spaces for people who have projects they need to focus on alone.

 

 

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Topics: Digital Transformation, Leadership, Success, Finance