Khorshed Alam is the Head of Retail Business at LankaBangla Finance Ltd. In an exclusive interview with Daily Sun, he shared different customer-oriented features of the organization that bring it success. He also talked about their plans and goals in the future.
DS: LankaBangla Finance Limited says it’s a place from where one can find solutions to their financial problems under one umbrella. Could you explain that?
Under the broadest umbrella of products and service offerings, we are the lone financial institution to operate credit cards (MasterCard and VISA). Since 2006 LankaBangla has been listed in both DSE & CSE in Bangladesh.
Technology allows us to be nimble, but clients also want more of a consultative solution and a quick turnaround. We have to provide a range of deliverables from, for example, entire fund administration to reconciliation, regulatory reporting, governance, and modeling.
The solutions have to be both scalable as well as specialist. The key is to keep innovative not only just the technology but also the processes and services. The proliferation of new financial products and services has led to many changes in how the industry has marketed itself to consumers.
Traditionally, NBFIs like us marketed their policies as the best; we tried to lure customers with higher rates on certificates of deposit. Now, using a product's best attributes within marketing campaigns is still relevant today.
However, service is rapidly overtaking product offerings as customers' primary criterion when choosing where to do business. This trend has naturally led financial service providers to put comprehensive product and service offerings under one umbrella.
We have attractive savings products like Quick Sanchay, ShohojSanchay which is specially targeted for Generation X, and we also have a product like Swasti which covered 18 to 65-year age segment and Protiva for the minor age segment that are best suited for your family and children, we covered it all today, Lankabangla holds 5th place in the credit card industry in Bangladesh.
We have the 2nd most extensive retail portfolio in terms of portfolio size. We are the pioneers in Auto loan in Bangladesh. We have specialized Home Loan Swapno for young professionals or entrepreneurs to fulfill their dream. Doesn’t matter which corner are you from in the country.
However, with the merci of digital technology, we can provide you customized financial service in one place in your very preferable device or location.
We are working with state of the art technology to provide an innovative solution to our customers, our Digital Transformation and ICT relentlessly working with designing or adopting new applications and software for the betterment of our service; we have already installed BI powered Chatbot, and very soon, we will able not only to install AI-powered application for better customer engagements but also to make it precise and faster services to our customer.
DS: How does LankaBangla attract consumers to its financing solutions? Is there any innovative way LankaBangla has adopted to reach the customers? How your ways are different from others?
Khorshed Alam: Today’s customers want companies to treat them as individuals rather than part of a “market segment” alongside thousands of other people. They want companies to offer products and services that are tailored to meet their specific needs, and ideally, they want companies to anticipate their needs. Customers are looking for the same experience in financial services. They want products and services that cater to their specific requirements, such as offering pre-approved loans when their balances are low and there are upcoming payments or tailoring terms, rates, and pricing to meet their individual requirements. Most banks and financial institutions are unable to deliver on the “personalisation” promise. However, with the help of digitalization, we are offering highly customized digital solutions to our customers. Sometimes, regulatory compliance is cited as a factor limiting banks' ability to customize their services, but we need to balance customer demands and the evolving regulatory landscape.
Banks and financial service companies like us need to realign our products and services to match customer expectations while delivering personalized products, recommendations, and communication. Insights derived from predictive analytics can help fine-tune the segmentation of target segments and help identify the key parameters for new products.
Personalisation in banking is about delivering a valuable service or product based on personal experiences and historical customer data. It helps us to build trust and, in turn, drive results and revenue. Creating an end-to-end experience that integrates customer and operational data across all branches, apps, and call centers. In short, personalization helps organizations like us to deliver solutions to our customers before they even realize they have a problem.
DS: Can you tell us more about your retail business that you think different from other non-banking financial institutions in the country?
Khorshed Alam: With online financial institutions, that rises to 89 per cent, and for those banks with a physical high street presence, it’s 77 per cent, according to study. Furthermore, research by Boston Consulting Group highlights that over the next five years $800 billion in revenue will shift to the top 15 per cent of companies who get personalization right in financial services, retail and healthcare. In fact, personalisation is particularly important in the financial services sector, because in the highly commoditized world of banking products it’s the customer experience, driven by personalization, that really sets financial institutions apart.
Growing our customer base is a vital part of building the success of our business, as we constantly need new and existing customers patronizing our brand. At LankaBangla, we are focusing on building a great relationship with our loyal customers.
LankaBangla was the first non-bank financial institution to have launched contactless credit cards in partnership with Mastercard in September last year.
DS: Why do you think the consumers should choose LankaBangla?
Khorshed Alam: It seems unreal that tomorrow's successful banks and financial industry organizations will be that far removed from those of today. Rather how customers interact with them will be different (digital customer interface).
Financial services have become anything but personal. The relationship we have with our money is being completely reimagined for the digital world, same as how we go about building financial services is changing. We are sure this trend will grow and be one of the key drivers in the financial services transformation. A personalised relationship builds trust.
Multi-touch attribution (MTA) method evaluates our digital marketing efforts from the bottom-up and provides a more person-centric approach by evaluating every touchpoint an individual hit on their journey to purchase. Then, we determine which touchpoints, channels, and messages had the most significant impact on the desired outcome.
Imagine that low and moderate-income consumers created the financial services of their dreams.
We, LankaBangla, are one of the leading FIs in the country and efficiently serve different business segments through our product innovation of customised financial products.
DS: Since you joined LankaBangla in the position, did you bring any changes to the department that help LankaBangla achieve its goals?
Khorshed Alam: I joined the then Vanik Bangladesh Ltd (later renamed as LankaBangla Finance Ltd) in July 1998 as an Executive - Finance and Administration. Afterwards, I was promoted gradually as Assistant Manager, Manager, Portfolio Manager, Assistant Vice President, Vice President, Senior Vice President, Executive Vice President and currently holding the position of Senior Executive Vice President.
I look after the Retail Business Division. As a long term serving employee, I worked in various departments of the organisation, including Finance, Administration, Human Resource, Credit Card, Home Loan, SME Business, Auto Loan, Personal Loan, Retail Liability and Digital Transformation Department. Under my supervision, our retail asset portfolio was around Tk30,000 million in 2019, the second highest retail asset portfolio in Bangladesh. The current Retail Liability Portfolio is Tk 25,500 million, also the second highest retail liability portfolio within the peer group.
Our credit card is the 5th place among the banks and NBFI’s in Bangladesh in terms of the number of cards and portfolio.
DS: You are saying LankaBangla provides “high quality service, maximum security of customers’ hard earned money, lucrative rate of return and loan facilities against deposits.”Can you explain more about these facilities?
Khorshed Alam: While technological development has made finance more accessible and convenient, security is a major issue. Cybercrime might sound abstract to some, but it causes real-world damage and is a leading barrier to success in digital finance.
Personalization means finding out what exactly our customers’ needs and wants. So when we say, LankaBangla is a place from where you can find your every financial solution under one umbrella.
Giving our customers the proper support means we have to spend more time doing what we do best: closing deals. Customers live in a changing world, and we need to keep pace staying relevant. Making incremental improvements enhances the customer experience. It also assures our sales team always has a competitive product to offer.
DS: What is your plan for the future regarding schemes?
Khorshed Alam: Financial markets have seen great technological advances, but pockets still operate inefficiently. Powerful forces are transforming the retail banking industry. Growth remains elusive, costs are proving hard to contain and ROEs remain stubbornly low. Regulation is impacting business models and economics. The only way forward is building customer relationships, and the only way that happens is through customization. Advancing technology is pressuring financial institutions to keep up with customer expectations. From advances in artificial intelligence to cybersecurity, technology is transforming the financial services industry.