121010_Mobile Banking & Payments for Emerging Asia Summit 2012_Next Generation Mobile Banking in Emerging Markets

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  • 1. Next Generation MobileBanking in Emerging Markets Ian WhiteheadDirector Retail and Business Banking, Commonwealth Bank Indonesia Bali, October 8th, 2012
  • 2. In the Past,We Had to bePhysicallyPresent toObtain aProduct/Service
  • 3. AndNOW…
  • 4. What has triggeredthe CHANGE in the last10 years?
  • 5. Content Page The Changing Demography & Population The Shift in Consumers’ Behaviors The Transformation in Banking Mobile Banking Capability The Way Consumers will Bank The Way Banks will Integrate Channels & Growth
  • 6. The Growing YoungAge, Middle ClassPopulation
  • 7. “Already, the working age (ages 15-64) population in developing markets is more than three times larger than that in developed markets, and is expected to surge 20% to more than four billion by the year 2025.” United Nation Older78% <45 years old Younger
  • 8. “By 2030, Asia will host 64% of the global middle class andaccount for over 40% of global middle-class consumption with Indonesia middle class market forecasted to triple to 150 million by 2015.”
  • 9. Content Page The Changing Demography & Population The Shift in Consumers’ Behaviors The Transformation in Banking Mobile Banking Capability The Way Consumers will Bank The Way Banks will Integrate Channels & Growth
  • 10. The Shift inConsumers’Behaviors
  • 11. Emerging Market lead the fastest growth in Social Network among the world# 4 in the World for Facebook #1 in the World for the Number ofUsers.. Posted Tweets...Indonesia is now at 43.06M, No. of Twitter users in Indonesia aregrowing over 21,000% 19.5M The 5th in the world for Twitter accounts
  • 12. Mobile Phone Subscription as per Q1, 2012 Indonesia has the largest mobile phone market in Asia, after China and India with 260 million subscribers (est. 2012)…..with over 107% penetration rate
  • 13. In Indonesia, ownership of internet capable mobilephone more than double the PC or Laptop
  • 14. Indonesia has the largest Smartphone market inSouth-East Asia with a 62% penetration rate
  • 15. Smartphone users are active users of Shopping,Productivity and Banking & Finance applications…
  • 16. Content Page The Changing Demography & Population The Shift in Consumers’ Behaviors The Transformation in Banking Mobile Banking Capability The Way Consumers will Bank The Way Banks will Integrate Channels & Growth
  • 17. The Transformationin Banking…
  • 18. Banking “channels” have evolved significantly over the past 10 years to accommodate changing customers’ needs Face to Face interaction LowHigh Bank Internet Mobile ATM Call Center Branches Banking Banking Interconnectability & HighLow Convenience
  • 19. Banking “channels” have evolved……. 2000  2004; Branch, ATMs & the emergence of call centers Branch ATM Call Center Internet Banking Mobile Banking • Inquiry • Live 24 hours • Inquiry • Cash Deposit • Inquiry • Cash • Cash Withdrawal • Complaint Withdrawal2000-2004 • • • Transfer Time Deposit Mutual Funds • Transfer • Credit cards handling • Basic transactions • Inquiry • Transfer thru SKN/RTGS  payment owned • Bancassurance • Automated by the bank • Bill Payment IVR response • Time Deposit • Mutual Funds • Bill Payment Shifting to Electronic • Standing Order • Inquiry2005-2009 • Cash Deposit receipt • Cheque book order • Internal Transfer • Mobile ATM • Bill payment • Online statement2010-2012 Weekend Banking • Mobile Cash • Real time transfer • Transfer thru SWIFT • Real time transfer • Time Deposit • Mutual Funds • Cheque deposit • ATM & Branch locator Banks location at • Paperless ATM2013-2015 customer convenience receipt (send to • MFD Redemption • MFD Redemption i.e mall customers • Online form app • P2P payment email) • P2P payment • Exchange Stock trade • Exchange Stock trade • Cheque deposit • Cheque deposit • Online chat with bank • Online chat with bank reps. reps.
  • 20. Banking “channels” have evolved significantly….. 2005  2009: + call centre capability & Internet Banking… Branch ATM Call Center Internet Banking Mobile Banking • Inquiry • Inquiry • Live 24 hours • Cash Deposit • Cash • Inquiry • Cash Withdrawal  Withdrawal • Complaint • Inquiry • Transfer2000-2004 • Transfer • Transfer thru SKN/RTGS • Time Deposit handling • Credit cards • Basic • Mutual Funds payment owned • Bancassurance transactions by the bank • Automated • Bill Payment IVR response • Time Deposit • Mutual Funds • Bill Payment • Standing Order • Inquiry Shifting to Electronic2005-2009 • Cash Deposit • Cheque book order • Internal Transfer receipt • Mobile ATM • Bill payment • Online statement2010-2012 Weekend Banking • Mobile Cash • Real time transfer • Transfer thru SWIFT • Real time transfer • Time Deposit • Mutual Funds • Cheque deposit • ATM & Branch locator Banks location at • Paperless ATM2013-2015 customer convenience receipt (send to • MFD Redemption • MFD Redemption i.e mall customers • Online form app • P2P payment email) • P2P payment • Exchange Stock trade • Exchange Stock trade • Cheque deposit • Cheque deposit • Online chat with bank • Online chat with bank reps. reps.
  • 21. Banking “channels” have evolved significantly…. 2010  today…channel interoperability & mobile… Branch ATM Call Center Internet Banking Mobile Banking • Inquiry • Inquiry • Cash Deposit • Cash • Cash Withdrawal Withdrawal2000-2004 • • • Transfer Time Deposit Mutual Funds • Transfer • Credit cards • Inquiry • Transfer thru SKN/RTGS  payment owned • Bancassurance by the bank • Bill Payment • Time Deposit • Live 24 hours • Mutual Funds • Bill Payment Shifting to Electronic • Inquiry • Standing Order • Inquiry2005-2009 • Cash Deposit receipt • Complaint • Cheque book order • Internal Transfer • Mobile ATM handling • Bill payment • Basic • Online statement transactions • Real time transfer • Automated • Transfer thru SWIFT IVR response2010-2012 Weekend Banking • Mobile Cash • Real time transfer • Time Deposit • Mutual Funds • ATM & Branch locator • MFD Redemption • MFD Redemption • Cheque deposit • Online form app • P2P payment Banks location at • Paperless ATM • P2P payment • Exchange Stock trade2013-2015 customer convenience receipt (send to • Exchange Stock trade • Cheque deposit i.e mall customers • Cheque deposit • Online chat with bank email) • Online chat with bank reps. reps.
  • 22. Banking “channels”; 2013  convergence, interoperability, social channels, real time and channel preferences… Branch ATM Call Center Internet Banking Mobile Banking • Inquiry • Inquiry • Cash Deposit • Cash • Cash Withdrawal Withdrawal2000-2004 • • • Transfer Time Deposit Mutual Funds • Transfer • Credit cards • Inquiry • Transfer thru SKN/RTGS  payment owned • Bancassurance by the bank • Bill Payment • Time Deposit • Live 24 hours • Mutual Funds • Bill Payment Shifting to Electronic • Inquiry • Standing Order • Inquiry2005-2009 • Cash Deposit receipt • Complaint • Cheque book order • Internal Transfer • Mobile ATM handling • Bill payment • Basic • Online statement2010-2012 Weekend Banking • Mobile Cash transactions • Real time transfer • Automated • Transfer thru SWIFT IVR response • Real time transfer • Time Deposit • Mutual Funds • ATM & Branch locator • Cheque deposit Banks location at • Paperless ATM • MFD Redemption • MFD Redemption2013-2015 customer convenience receipt (send to • Online form app • P2P payment i.e mall customers • P2P payment • Exchange Stock trade email) • Exchange Stock trade • Cheque deposit • Cheque deposit • Online chat with bank • Online chat with bank reps. reps.
  • 23. Content Page The Changing Demography & Population The Shift in Consumers’ Behaviors The Transformation in BankingMobile Banking Capability The Way Consumers will Bank The Way Banks will Integrate Channels & Growth
  • 24. Mobile BankingCapability
  • 25. Mobile Banking inIndonesia
  • 26. The number of Mobile Banking users in Indonesia isestimated at over 8 million... VALUE SERVICES • Bill Payment BASIC SERVICES • Purchasing • Balance Info • ATM & Branch locator • Account Movement • E-Commerce Payment • Internal Transfer • Foreign Exchange & Interest Rate info • Interbank Transfer • Transfer to e-wallet/e-saving • Mobile Cash. www.klikbca.com BCA’s key points:Mandiri’s key points: • One platform offers• Well established flexibility options to• Very easy user use either m-BCA (via interface SMS) or KlikBCA (via GPRS etc)
  • 27. With significant capability and functionality growth, and upgrades being released....Permata’s key points:• Mobile Cash – similar www.commbank.co.id like Cash withdrawal without ATM card on Commonwealth any Bank Permata Bank’s key points: ATM. • Interbank Transfer (domestic & international using www.cimbniaga.com foreign currencies) • Mutual FundsNiaga’s key points: Purchase & inquiry,• Transactions using • Time Deposit OTP (One Time Placement & inquiry. Password) sent through SMS ~in progress
  • 28. Mobile BankingOverseas
  • 29. Mobile Banking Overseas Today www.danskebank.com www.usaa.com• Instant mobile payments, • Stop payment on a• Currency exchange check• Stock trade • Use money manager• Live account status to track spending info • Add money to• Quick access to prepaid cards contact info • Make cash advance• GPS –and map – deposits enabled ATM & branch search• Intuitive design..
  • 30. Mobile Banking Overseas Today www.maybank.com home.ingdirect.com • Personalization• P2P Payment features• Investing in stock • Connection to bank’ market social media• Enables customer to platforms to flip their mobile to customers switch the application to social media such • Smart and fun add- as Twitter/Facebook ons like Instant Rewards
  • 31. Mobile Banking Overseas Today www.commbank.com.au • Kaching: Bump payment and peer to peer payment • NetBank – enables customers to take care their day to day banking • CommSec – enables customer to buy & sell stocks on the go and instant access to market updates
  • 32. Use of Mobile Banking in IndonesiaToday…
  • 33. Content Page The Changing Demography & Population The Shift in Consumers’ Behaviors The Transformation in Banking Mobile Banking Capability The Way Consumers will Bank The Way Banks will Integrate Channels & Growth
  • 34. How will itChange the WayConsumersBank ?
  • 35. Customer expectation of Mobile Banking is becoming ‘value-centric’ Configuration & Real Time personalization capabilityInteroperability of existing & Security – consumer new channels, e.g. and new and industry capability (NFC, e-Wallets) and client (& data) driven communications. Anytime, Anywhere Integrated and banking seamless…
  • 36. Content Page The Changing Demography & Population The Shift in Consumers’ Behaviors The Transformation in Banking Mobile Banking Capability The Way Consumers will Bank The Way Banks will Integrate Channels & Growth
  • 37. Integrating theChannel andGrowth…
  • 38. Integrating fast growing channels, a customer centricstrategy & consumer confidence …….how?Balancing:1. Ease of access, privacy and security…2. Customer demands and bandwidth (technical)..3. Innovation  explosive growth and the need for regulation…4. Industry reputation and consumer confidence5. Requires collaborative engagement; Industry + Regulatory + Consumer (all working in sync).
  • 39. Ian WhiteheadDirector of Retail and Business Banking Commonwealth Bank Indonesia