IN January, Bank Negara Malaysia (BNM) announced Malaysia's Financial Sector Blueprint 2022 - 2026 for the nation's financial sector development.
One of the initiatives for this five-year blueprint includes advancing digitalisation of the financial sector, among other things.
When it comes to digitisation, Oracle Financial Services' Group vice president Venky Srinivasan said that a radical shift is already underway, as Malaysian retail and small and medium-sized enterprises (SME) banking sectors have been issued digital banking licenses.
"The ability to leverage real-time payment platforms will not only fuel innovation, but also foster better collaboration on cross-border, real-time payments with Singapore, Indonesia and Thailand. Malaysia is also positioning itself to be a leader in the cash management space.
"This includes driving a clear vision to advance digitisation in the financial sector through a future-proofed digital infrastructure that is backed by open data ecosystems, effective oversight, and a greater push for technology advancements," he said.
However, Srinivasan is of the opinion that this progression has left corporate banks wondering how to move forward. This is based on the recent Global Treasurer's Banking Transaction Survey, where 36.4 per cent of corporates said that improving digital customer experience or service was the main reason to review their banking relationships.
"Simply put, corporates want digital experiences that are similar to what they get from other sectors and areas of their life, like shopping online or ordering a car service.
"But they want the deep functionality and analytics that are required to manage working capital better, including real-time liquidity and cash management capabilities, and fast access to funding when needed," he said.
To appeal to their corporate customers, Malaysian banks need to consider the following ways to approach digital banking for a more seamless experience:
WAYS TO REDESIGN DIGITAL CORPORATE BANKING
1. A contextual, personalised and frictionless experience
Srinivasan said that banks should provide intuitive tools and services that are also fueled by analytics to deliver personalised, contextual insights to improve the experience for both staff and clients.
"These experiences should span common corporate banking functions that today can be taxing and slow – including payment initiation, loan approvals, letter of credit issuance, or even onboarding – and make them frictionless and fast."
2. Real-time view of cash, liquidity and complete working capital clarity
In the 2020 Global Treasurer's Banking Transaction Survey, 61 per cent of respondents chose 'a single view across all of the company's bank balances in real-time' for the area needing the most improvement.
Based on this, Srinivasan believes that having a single view across operations that can be shared with a global or regional treasurer of a multi-county corporate bank is essential for banks to make holistic decisions.
3. Connected ecosystems with platforms that support API-first design
Srinivasan said, "Going beyond the traditional touchpoints and bringing an open architecture environment allows corporates to leverage the efficiencies of a connected ecosystem.
"While open banking is the first step to the journey, banks globally are also making greater strides into embedded finance. With corporates looking more to banks to add value by embedding financial products into corporate business services, banks are seeking a partner that can help in this next stage of their digital journey."
4. Flexibility to customise the customer journeys
Differentiating digital services is important to deepening customer relationships, especially with the commoditisation of products and ever-expanding choices available.
"As the 2020 Global Treasurer's Banking Transaction Survey noted, 25 per cent of corporates surveyed are using non-bank FX providers, putting competitive pressure on banks to play catch-up on differentiation. By listening to corporates as to what services and business capabilities they want, banks can customise their digital experiences to what their clients desire."
MASHREQ BANK WITH ORACLE FINANCIAL SERVICES
One of the United Arab Emirates' leading financial institutions, known as Mashreq Bank, is on track to build the future transaction banking business.
The main aspects of next-generation transaction banking, according to Mashreq Bank, include multi-channel coverage, end-to-end digitisation, seamless integration with client value chains and analytical frameworks.
Mashreq Bank also believes that distributed services, APIs and emerging technologies will play a bigger role as the industry transforms, as it also intends to create a 'client native' business model.
In order to set the platform for next-generation transaction banking, Mashreq Bank utilises Oracle Financial Services.
EVP and Co-Head of Mashreq's Global Transaction Banking Wisam Mahmood explained, "With its componentised framework and best-in-class microservices, Oracle Financial Services can enable the bank to be highly responsive, ready for disruption, and deliver value back to corporates by offering services and solving problems at a lower cost."
ORACLE REINVENTS CORPORATE CLIENT DIGITAL EXPERIENCE
Oracle Financial Services has redesigned its corporate banking portfolio to meet these objectives in terms of architecture and client experience.
For a truly digital experience, they have stopped using traditional approaches, resulting in bringing an intuitive, contextual experience integrated with connected analytics and insights for their corporate clients. Consequently, they are also the winner of the 2021 XCelent Advanced Technology Award for Corporate Digital Platforms.
In fact, Celent's Head of Corporate Banking, Patty Hines, noted, "Oracle's solution stands out for advanced technology with its breadth of deployment options and integration methods, along with intuitive, persona-based dashboards and user interfaces.
"In addition, the platform's microservices-based architecture enables full omnichannel capabilities across online, host-to-host and APIs."
To find out more about Oracle Financial Services, visit this website.