What does RETAIL have to do with BANKING?!?!?

What is Retail Banking?
Retail banking & retail trade
The Retail banking shelf space
Retail banking in Nigeria
Retail strategy and positioning
Retail banking tomorrow
Key takeways....
Recent innovations in Retail
2

Retail banking is the provision
of services by a bank to
individual consumers and
SMEs, rather than to
companies, corporations or
other banks.
Retail banking tailored
SAMPLE SLIDES
Source: wikipedia
Retail banking tailored
towards individuals is also
called Consumer Banking,
while the services offered to
Small and Medium-scale
enterprises (SMEs) is called
Business Banking.
3

•Simple Savings product
•Debit card for
Teenagers
•Social Media
•Single-banked
• Electronic channels
Parent-funded
•Simple Transaction
account (savings)
•Social Media
•Brand-conscious
•Single-banked
Parent-funded Self-fundedParent-funded Self-funded
Low Income
potential
Parent-funded Very high income
potential
Medium income
potential
High income
potential
•Complex Transactions
accounts (SA and CA)
•Credit-driven
•Investment-focused
•Multi-banked
•Simple Transaction
accounts (SA and CA)
•Credit-driven
•Investment-focused
•Multi-banked
•Branch channels
4

Insurance
Capital
Markets
Banking
General
Reinsurance
Issuing
houses
Stock
brokers
Specialized FIs
Banks –
Development Finance
Pension Funds
Management
Pension Fund
Administrators
Infrastructure
Providers
Portfolio
Managers
…AF
FECT
ING
FINA
NCI
AL
SER
VICE
SIN
TER
MS
OF
DIM
ENSI
ON
AND
SCO
PE…
6
Security &
Exchange
Commission
Nigerian Insurance
Commission
National Pension
CommissionCentral Bank of Nigeria
Life
Regulatory Influence Universal Banking
Banks –
Universal,
Community,
Microfinance
Discount
Houses
Development
banks
Finance
Companies
Administrators
Pension fund
custodians
Payments: Interswitch, Valucard, ATMC, NIBBS,
CSCS,
Managers
Venture
Capital
PMIs
Other providers: Securicor, eXl Cash
Services, Rating Agencies, Credit Bureau

SAMPLE SLIDES
Source: ITCInfotech.com
7

Key takeways....
8

RETAIL STORES RETAIL BANKS
SALES-ORIENTATION
Emphasis is on Sales (promotions
and programs)
Emphasis is on Sales (promotions
and programs)
PRODUCT-FOCUS
Products and services are always on
display
Products and services are always on
display
LOCATIONING
Retailers take the products to the
marketplace, not vice versa (stores
and shops)
Retail bankers take the products to
the marketplace, not vice versa
(stores and shops)
Very little customisation; Very little customisation;
Retail banking and Retail trade….
FACTORY APPROACH
Very little customisation;
everything is sold “as-is”
Very little customisation;
everything is sold “as-is”
PROFIT MARGINS
Profit is dependent on large volume
sales
Profit is dependent on large volume
sales
TECHNOLOGY
Various Technology touchpoints in
serving customers
Various Technology touchpoints in
serving customers
RISK MANAGEMENT
Retailers make money once the
product is SOLD
Banks only make money when
LOANS ARE PAID
KNOW-YOU-CUSTOMER
Retailers can sell to almost
anybody, anywhere at anytime!
Banks are legally and regulatorily
mandated to KnowTheirCustomer!9

Key takeways....
10

Savings Accounts
Traditional
Products
Current Accounts
Loans & Mortgages
E-products
 Credit cards
 Debit cards
 Prepaid cards
 Internet banking
 Mobile banking
Banc-assurance
Life General
Investments
Mutual Funds
Wealth Management
11

Savings Accounts
Traditional Current Accounts
Loans
Mass affluent
Card products
 Internet banking
 Mobile banking
Generation “E”
Traditional
Products
Current Accounts
Loans & Mortgages
Heavily
banked
Price
conscious
E-aware
Card products
Savings accounts
Mass Market
Prepaid cards
12

Key takeways....
13

Key takeways....
17

CUSTOMERSEGMENTATION–UBNC
PROPOSED
Descriptor Characteristics
Turnover / Gross Earnings
(Annual)
SME (businesses) Small-medium scale enterprises
Require cash management services,
payroll, lines of credit, financial
training
<N500M* annual turnover (do
not require customization)
High Net Worth
(private banking)
Upper class/ Executives
(professionals – senior
management)
Successful, career-oriented;
interested in investments, travel,
education for kids (local & foreign),
home purchase, investment etc.)
N21M and above+
UBNCURRENTVS.
Mass Affluent /
(the bigger boys)
Upper-middle class
(professionals – mid-senior
management)
Career-oriented; interested in
investments, travel, education for kids
(local) home purchase, investments
N7M – N20M
Mass Retail
(middle class)
Middle class
(Salaried, Junior-mid level
staff, students)
Upwardly mobile; Interested in
investments, education for kids
(local), travel, car purchase, etc.
Students with affluent lifestyles
N1.5M – N6.9M
Underbanked
(survivors)
Clerical staff, artisans,
Minimal income and sophistication,
interested in savings
<<N1.5M
Sources: EFInA, AMPS 2012; Research & Media Services Nigeria, 2013
18

Retail
Market
segment
(Annual
Income)
Underbanked
<<N1.5m
Mass Retail
N1.5 – N6.9
Mass Affluent
N7m – N20m
Sub segment Informal
Formal and
Informal Sector
Youth Salaried - Formal Informal
Product
- Deposits
- Debit cards
- Deposits
- Debit cards
- Deposits
- Debit cards
- Mobile USSD/
- Deposits
- Bill payments
- Debit/credit cards
- Deposits
- Debit cards
- Loans/overdraftsProduct
needs
- Debit cards
- Mobile USSD
- Funds transfer (local
and int’l)
- Debit cards
- Mobile USSD
and int’l)
- Mobile USSD/
Smartphone App
and int’l)
- Loans/overdrafts
- Mobile USSD/
Smartphone App
- Fund transfers
- Loans/overdrafts
- Mobile USSD
Service needs
- Proximity to branch
- Face to face service
- Price sensitive
- Low touch
- Price sensitive
- Self-service
technology
- Social media
interface
- Higher touch/
dedicated RMs
- Will pay fees but
price sensitive on
rates
- Higher touch/
dedicated RMs
Channel
needs
- Physical branch
nearby
- ATMs
- Physical branch
nearby
- Call centre
- Mobile money
- Agent banking
locations
- ATMs
-Self service terminals
- ATMs
- Mobile banking
- Internet banking
- Physical branch
- Call centre
- Mobile banking
Team Analysis 19

Retail
Market
segment
(Annual
Income)
High Net Worth
>N21M
N0-250M (businesses with retail needs)
Sub segment High Net Worth 1 person enterprise
Small businesses (less
than 20 employees)
Institution (structured e.g.
schools, churches, NGOs)
- Bill payments
- Electronic Banking
- Bill payments
- Loans/overdrafts
- Bill payments
- Loans/overdrafts
- Loans/overdrafts
- Tax payments
- Fund transfers
Product
needs
- Fund transfers
- Tax payments
- Cash mgmt
- Mutual funds/Investments
- Loans/overdrafts
- Tax payments
- Mutual funds/
Investments
- Loans/overdrafts
- Salary payments
- Tax payments
- Fund transfers
- Salary payments
- Mutual funds/
Investments
Service needs - Dedicated RMs for all needs
- RM for specific
needs
- Price sensitive
- Expert RMs for specific
needs
- Expert RMs for specific
needs
Channel
needs
- ATMs
- RM by phone
- RM in person
- E-banking
- Physical branch
- Phone call
- Mobile
- Agent banking
locations
- Physical branch
- RM for specific needs
- Phone call
- Mobile
- Physical branch
- Phone call
Team Analysis 20

WHYFOCUSSTRATEGIES
 
AREDIFFERENT

21

Key takeways....
22

Key takeways....
25

Key takeways....
28

SO, WHAT ARE YOUR KEY TAKEAWAYS?
Q & A
2
9

What does RETAIL have to do with BANKING?!?!?

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (18)

Similar to What does RETAIL have to do with BANKING?!?!?

Similar to What does RETAIL have to do with BANKING?!?!? (20)

Recently uploaded

Recently uploaded (20)

What does RETAIL have to do with BANKING?!?!?