The group managing director/chief executive officer of Keystone Bank Limited, Mr. Obeahon Ohiwerei, in this interview with LEADERSHIP speaks on Nigerian economy and the achievements of the bank in the last few months since assuming office.
Do you think Nigeria’s 2016/17 economic recession is now firmly in the past?
Despite fragile growth quarter-on-quarter and subsisting vulnerability to global shocks in commodity prices, I believe it is safe to say that the recession is past and barring any major socio-political upheavals it is unlikely to recur, at least not to the scale witnessed in 2016 through 2017
Moreover, the federal government has taken active steps towards reinforcing growth and widening its revenue base, particularly from the standpoint of driving increased tax compliance and plugging any identified areas of income leakage. Other fiscal and structural factors that should strengthen economic growth include the Presidential Enabling Business Environment Council (PEBEC) set up in July 2017, to remove bureaucratic constraints to doing business in Nigeria; Increased diversification of the country’s economy through multiple intervention programmes in the non-oil sectors; accretion of external reserves on the back of increasing oil revenue and steady moderation in inflation.
As a bank we are well poised to capitalise on this recovery and on our assumption of office in Q3 2017, my executive team and I embarked on an extensive restructuring process aimed at achieving greater operational efficiency, extensive process improvement and the realignment of skills and competencies to areas of best fit, both at senior and middle management levels
We have also remodelled our digital platforms for collections and payments, to provide increased convenience and value-addition to our customers’ lifestyles and business
So far the market response has been positive and our customer deposits have grown in excess of 40 per cent over the last three quarters.
How do you see Nigeria’s banking industry changing over the next few years?
Over the next few years, I expect to see increased competition for customers’ confidence and share-of-mind. I expect to see banks compete more aggressively on such subtle yet potentially profitable indicators as increased account activity, customers’ ease of transaction across touchpoints, scale of digital spread and partnerships (as against number of physical branches), incentives for repeat business and greater customer lifetime value and overall business efficiency
I also expect to see banks increasingly leveraging data analytics to better-predict customer behaviour for effective marketing and retail loans creation
Finally, while the retail and MSME sectors should remain the main focus for banks, I expect to see this drive replicated strongly in the corporate banking space with unique offerings to tap their downlines and value-chains
How do think access to finance can be improved for the underbanked and unbanked in Nigeria? What specific measures are you taking to attract these groups?
Financial institutions, Fintech companies, government and other developmental partners need to sustain the momentum by continually driving and funding research into relevant behavioural dynamics of the unbanked and underbanked segments, creating incentives for the unbanked to see value in being part of the formal sector, developing suitable savings propositions and appropriately-priced micro-loan products that realistically address their needs and leveraging the extensive geographical spread of government agencies to co-locate and in the process bring financial services within reach of the populace
Keystone’s stated vision is to “set the pace in financial services delivery, creating utmost value for our stakeholders.” What exactly do you mean by “setting the pace”?
The statement you referred to was actually our former vision statement and as part of our re-engineering process, it has since been replaced. Our current vision is “to be the preferred platform for delivering convenient and reliable financial solutions.”
In doing so, we shall consistently leverage people and technology to deliver superior customer experience and enhanced stakeholders’ value. In my view, the word “preferred” takes us above the fray; it elevates the discussion beyond traditional metrics of balance sheet size, asset base and the like, which are still important to us.
However, it commits us to delivering such excellent service in all we do that customers repeatedly trust us, desire to do business with us and are always willing to give us the benefit of the doubt.
The bank’s Pink Account is a special account for women that gives access to an online digital-marketing network, among other features. What made you believe that such a service was needed?
In its Financial Inclusion Overview updated April 20, 2018, the World Bank noted that “around 2 billion people don’t use formal financial services and more than 50 per cent of adults in the poorest households are unbanked.”
In Nigeria, multiple surveys by EFInA Access to Financial Services confirm that about 36.9 million adults are financially excluded, of which 57.9 per cent are female, while 42.1 per cent are male. Against this backdrop, the Central Bank of Nigeria (CBN) has in recent years actively pursued a holistic financial inclusion strategy across the country
On our part, the Pink Account is designed to meet the needs of our female working class and small and medium enterprises (SME) customers and provides such benefits as access to attractive loans, customised electronic debit cards and access to discounts from partner stores, while the pink network is an online forum that empowers our female entrepreneurs with free mentorship and capacity building sessions
Women from different walks of life can network, share ideas, inspire each other and develop mentor/mentee relationships , while the Pink Marketplace provides an e-marketplace where they can buy, sell and advertise for free
Your bank recently partnered with CeLD Innovations Limited, a Cash Reward as-a-Service Company, to launch the product CashToken. What are the main benefits of this product?
At Keystone Bank, we already know that today’s businesses are not only susceptible to technology disruptions but are under a bigger threat when they fail to place a premium on their share of the consumers’ emotional equity.
Across all sectors, consumers are forcing the narrative that achieving customer-centricity is no longer a differentiator, but a key determinant of business survival or leadership. This informed our partnership with CELD to launch the Cash-Reward-as-a-Service product named the “CashToken” which can be won by new and existing customers that activate accounts on our mobile app or USSD and actually execute at least 5 fee-earning transactions (instant transfers & bill payments), active customers who maintain a minimum balance of N10,000 at least 30 days to their birthdays, both customers of Keystone Bank and non-customers that do at least three transactions on our ATMs. Active customers can win between N5,000 and N100,000,000 at our periodic draws as well as access general & health insurance benefits subject to specified terms and conditions
Furthermore, agencies of government can also leverage the Cash Token to incentivise conscientious tax and related statutory payments
Keystone aims to partner with more than 50,000 SME sector players as part of its strategy to become the fastest growing retail bank in Nigeria. How exactly does the bank go about partnering with such a large number of companies?
Globally, SMEs are established drivers of even the strongest economies and Nigeria cannot be an exception. With over 15million SMEs dotting the Nigerian landscape, we are poised to ensure our customers in this segment actively grow their businesses through our partnerships and focused initiatives in the segment. We shall continue to partner with the government and other developmental agencies in making intervention funds available to the segment. Our SME proposition is the “Growbiz Account” with three variants that address their cycles of growth from infancy through maturity and stability. We are also empowering SMEs through our agency banking initiative by signing them up as agents for basic off-site cash-in/cash-out services
Given that trade finance is among the most hotly anticipated businesses to be transformed by blockchain, do you envisage utilising this technology in the future for such a purpose—or indeed, for any other part of your business?
Blockchain with its mechanism of distributed and secure validation, has the capacity to subject every party to a high degree of accountability, forestalling missed transactions, human or machine errors, or transactions occurring without the consent of relevant parties
Nevertheless, the peculiar demands of banking transactions require that we implement a measured approach to adoption.
The Central Bank of Nigeria (CBN) has advised financial institutions in the country to stay action on the use of this technology for now and this prudential safeguard is not unconnected with the risks currently associated with it. We shall follow the lead of the CBN regarding integration into our operations
The bank is in the process of launching an exciting new digital financial-services platform. What are some of the platform’s key features?
The proliferation of digital banking in the retail space has made branchless banking a strategic and compelling proposition especially in the retail value-chain.
Keystone mobile banking app has introduced a new level of banking with exciting offerings and features most of which were hitherto non-existent across the entire banking industry. These include Zero-Data Banking – which allows customers to transact using our mobile app even without data on their phones; Chat Banking service – which allows customers to transact while they chat via Telegram and Facebook; The “Meet Account Officer” feature – which introduces customers to their assigned account officers and allows them to interact directly on the platform; Foreign Currency (FCY) Transfers – where customers are able to make transfers to banks across the globe right from the mobile app; Movie Tickets – which allows customers view available movies and book ticket; Standing Instructions – which allows scheduling of recurrent payments and transfers; Self-booking and liquidation of Fixed Deposits and the Enabling and Disabling of cards – which can be a useful safeguard in the event that a customer loses any of our electronic cards
Our new USSD code also allows customers to transact from just about any type of mobile phone, offering such exciting features as bills payment, airtime top up, account opening,and account reactivation.
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