Finance Monthly March 2020 Edition

claims experience or mortgage application. Simple processes like KYC and document collection are often still manual and e-signatures are not considered legal means of transaction yet with applications such as eSignOnline waiting yet to be adopted. Products are developed mainly from the perspective of financial institutions’ and the legal environments’ needs when customers may require entirely different solutions for their needs. The second key challenge is scale, or rather the lack thereof. With the exception of Egypt, Saudi Arabia and to some degree the UAE, markets in the Middle East are mostly small in size (both in terms of GDP and population). This limits the ability of companies to grow and to, therefore, invest in new technologies. This is a particularly significant issue in the insurance space but by no means less important in banking. The third key challenge is the transformation of organisations and along with this, the skills, mindset and capabilities of employees. This includes, for example, the acceptance of new working styles, agile management methods and the embracing of innovation by an industry and workforce which has traditionally been very conservative. If we look at customer centricity, what specifically needs to be done? Being able to adjust interactions to the specific demands and needs of customers is key for customer- centricity – ideally down to the level of the individual customer. This is what financial institutions are not very good at, which opens opportunities for more customer-centric organisations such as telcos, retailers, native online players, and others to create viable value propositions. For example, not many financial institutions in the Middle East analyse their NPS or their customer complaints registries in a structured and continuous manner for improvement potential. Social media posts (Twitter, Facebook, LinkedIn) are mostly ignored as a means for gathering customer feedback – and these are low hanging fruits. Augmenting this through platform use and technologies can help in making substantial progress towards understanding their customers better and deeper. This is where the scale problem comes into the mix. Domestic platform. Another example is Ping An, the insurance company that has developed from a brick-and- mortar insurer into a veritable tech platform over the past decade or so. These super apps and large-scale platforms are only in their infancy in the Middle East. They are mostly a matter of creating scale and cooperation between players, and will sooner or later also land in the Middle East. What are the key challenges that financial services in the Middle East face? Thefirst key challenge forfinancial services players in the Middle East is customer-centricity. Banks and insurance companies have traditionally been cumbersome to deal with – and many still are if you just think about the average FINANCIAL INNOVATION & FINTECH - DIGITALISATION 43 www.finance-monthly.com COMPARISON OF STRATEGIES The benefits of seamless process design INCOMPLETE digitalisation strategy SEAMLESS process design Insular Solutions Website optimisation Smartphone apps Social media FRONT-END DIGITALISATION Exhaustive IT Modernisation Harmonised IT systems Automated processing Open interfaces Digital partnerships END-TO-END DIGITALISATION Source: Roland Berger