Major changes on digital banking platform coming, says CEO, Standard Chartered Bank Nigeria

Sustainability Banking has been one of the current front burner issues across the banking industry. What is the Standard Chartered Bank doing in this area especially as regards Nigeria’s infrastructure, human development and SMEs and in line with the Bank’s tagline,“here for good”?

We are in the business of commercial banking, which we will continue to engage in and do to the best of our capability, however, beyond just the core function of banking we also look at sustainability and for us sustainability is not something we see as separate from our core business we believe that it is integral to business because when we do our core business well, we are actually contributing to the overall economic development of the country.

But in terms of the pillars of our sustainability, we have now sort of refreshed it to focus on three areas; one is education, the second is employability and the third is entrepreneurship, we believe that these three are critical in terms of enabling the future workforce especially the youth to be able to contribute meaningfully to economic development. So education, once people are educated, they get employment or go into entrepreneurship. So we are looking for ways to support all of these our three pillars.

The recent announcement of our women in technology programme is to actually empower women entrepreneurs in the technology space because that’s an area where women are not very strong in. They are in the entrepreneurship field but when it comes to technology its dominated by male technologists. We came up with a programme where we specifically targeted women entrepreneurs; take them through an incubation programme in partnership with Pan-Atlantic University so that out of the numbers we will likely get, we narrow it down to top ten, then those ones will go through a screening process, the finalists will be selected, five of them, and we give them money to be able to accelerate their businesses and the necessary support to take the business to the next level.

This is something that we had started in the US about five years ago and then we brought it to Kenya and I am very delighted that we are able to do it in Nigeria.

In terms of the other areas like infrastructure, SMEs, these are the areas that the bank has the capacity to support the Nigerian economy.

When it comes to power, Standard Chartered Bank was one of the biggest supporters of power Africa. If you recall when Obama was in the office, he lunched Power Africa and Standard Chartered pledged that we are going to be a very strong partner on the Power Africa initiative.

In terms of SMEs, that’s again our area of focus. We have two divisions in the bank, the commercial banking division and the business banking division. The commercial banking division looks at the larger enterprises while the business banking looks at smaller enterprises. And again, it is my intention to grow that portfolio in line with the desire of seeing more lending to SMEs and more lending to the real sector.

Coming from Kenya where mobile money was a huge success, do you think that it should be more teleco-driven or bank-driven?

That’s always a debate. Of course in Kenya it was teleco-driven. Banks would like it to be bank-driven. By the way, I was quite impressed with the NIBSS (Nigeria Interbank Settlement System) that we have in Nigeria. In fact, banks in Kenya decided to come up with similar platform. It was called PESALINK and it is to allow real time transferring of money from one bank account to another. And then the head of the NIBSS was with us in Nairobi and he was telling me that NIBSS is actually M-Pesa on steroids here in Nigeria because everything is done through it. I think the banks in Nigeria clearly have taken the lead as opposed to Kenya where it was telco-driven. At the end of the day what we want is for the client to get the best value for the service.

For Nigeria, it would be bank-led obviously. Because we are active and if you don’t play in that space you will give a chance for somebody else. So this is our space, payments and money; that’s our strength, so we leverage on that.

So you said you are here for a long haul and by September you will be 20 years in Nigeria, but your record shows you have only 22 branches, meaning you are yet to cover Nigeria’s 36 states. How are you going to impact all the people and parts of the country?

Yes we have 22 branches mainly in Lagos, Abuja and Port Harcourt for retail banking. We decided to adopt a focused strategy which means that we are focusing on few cities as opposed to the nationwide, a sort of mass marketing strategy which some other banks are following. Now, we are investing on the digital banking platform and we will be announcing some major changes on that front. We believe that the future of retail banking will largely dovetail towards digital channels because quite honestly if you look back in 30-40 years ago, the roles of our traditional bank branch then and the role today is quite different. So, the things that will typically take you to our branch are the things that you can now do without visiting our branch and therefore, that speed, convenience, accessibility that the digital channels provide our clients is the area that we feel we should invest more in as opposed to physical channels. I’m sure you know about banks that are now actually entirely digital; they start with digital platform end-to-end; from opening an account everything has to be digital. So we are going to spend on that space and that will give us the capacity to scale up and reach out.

You are aware of the CBN Governor’s agenda on bank’s recapitalization and lending to real sector as opposed to concentration of your investments in Treasury Bills and Bonds; What is Standard Chartered going to do to support these initiatives?

About recapitalization, whether it will have impact on lending to the real sector, well we will see how it evolves. Obviously the signal has been sent that over the next five years we might see an increase in capital base for banks and I think as Standard Chartered we are well positioned so we will respond to that at the appropriate time. Then the issue of lending to the real sector I think it is something that is absolutely important from a macroeconomic point of view. Investment is a key component of GDP as well as consumption and these are all areas where banks can play a critical role. So if we can start seeing opportunities for investments in those sectors whether it is in the power sector or the transportation sector these are areas that have bankable projects; I think the demand is there and it is a question of just banks and other partners responding to that demand.

So, all I can say is that we are ready if those projects are there so that we can reduce that skewness in terms of investment away from Treasury Bills and Bonds which are important obviously to support the government, but even the government realizes that it is better to have more of those investments deployed into the real sectors of the economy. So as a bank, we are aligning and fully supportive of that.

Source: Vanguard