Malaysia’s banking Group CIMB is in the process of building a tech powerhouse:
Malaysia’s CIMB Group is proposing to invest some RM1.2 billion (approximately US$263.65 million) in 2022 to enhance the digital transformation of the bank and to strengthen its technology and operational infrastructure.
The universal bank that came into being following a series of complex mergers and acquisitions, starting in 1974, is today catering to high growth economies in ASEAN through a maze of entities that include CIMB Investment Bank, CIMB Bank, CIMB Islamic, CIMB Niaga, CIMB Securities International and CIMB Thai. Its core business is focused on consumer banking, wholesale banking, comprising investment banking and corporate banking, treasury & markets, and strategic investments. Its main focus geographies besides Malaysia are Indonesia, Singapore and Thailand. It also has a strong Islamic banking division, CIMB Islamic, which operates in line with the group’s dual banking model. The Group has around 33,000 employees in 18 countries.
A NEXT GEN BANKING APP
The investment will be primarily used in introducing a Next Gen mobile banking app and creating several other digital conveniences for the customers. The Group has announced that its priority at the moment is to build on its positive growth momentum while maintaining a focused approach to investing in areas of growth, such as affluent and wealth management, transaction banking, and ASEAN network business.
The Group has created a unit called CIMB Digital Assets (CDA), which handles the Group’s digital businesses and ventures. This initiative ensures that the Group went beyond traditional banking during these times of digital disruption. The Group had consciously decided to get digitization done internally, and at the same time incubate and create some businesses slightly on the outside, and have a digital and ‘future banking’ DNA. So, under CDA, the Group has 4 businesses – Touch ’n Go, or TNG, a wholly-owned unit of CIMB Group, TNG Digital, a joint venture between Ant Group and TNG, CIMB Philippines and CIMB Vietnam, which are digital banks.
USING AI FOR CREDIT MODELS
The Group’s CIMB Bank was recently awarded the Best Financial AI Project in Malaysia at The Asset Triple A Digital Awards 2022 for its automated platform developed by DataRobot, a leader in AI Cloud solutions. The platform enabled the bank to develop ML-based credit models for its retail portfolio, which strengthened its credit risk modelling and retail underwriting capabilities across unsecured loan products.
The Group had launched a Forward23+ strategic plan focusing on user experience. The bank had during the pandemic, put in place an end-to-end fully digital account opening process using OctoSavers Account-i and sent customers their debit card through mail. The procedure is made possible by leveraging Bank Negara Malaysia’s electronic KYC facial recognition due diligence guidelines, along with digitization of several backend processes.
DIGITAL TRANSACTIONS UP
The digital transformation has paved the way for a growth momentum in the Group’s operations in Malaysia, Thailand and Singapore. It saw a 50% increase in digital transactions and a 99.20% service reliability and availability level. The digital sales of CIMB products accounted for 48% of total sales in Malaysia as of October 2021.
The Group has successfully developed methods to make use of data so that besides having a 360-degree customer view, could increase product penetration and improve cross-sale rate. Using the data that is available for several years, the Group has developed real-time triggers, such as financial transaction reminders and targeted campaigns. It has also introduced a process of digital personalization for customers to provide solutions that match their financial behaviors.
The Group’s 2 key units – CIMB Bank and CIMB Islamic – have introduced 2 digital-first solutions for customers, an online-to-branch account opening process for individual banking customers and Biz Financing Portal for SMEs. These paperless solutions ensure that banking offerings are more accessible, providing safety and convenience by leveraging digital capabilities to enhance customer experience. Using the solutions, individual customers are now able to submit their applications to open a current or savings account, online. SMEs, on the other hand, will now be able to submit financing applications online at CIMB’s Biz Financing Portal.
CIMB Islamic is at the forefront in providing innovative solutions – from wealth management to business financing. CIMB Islamic is the second largest Islamic financial services provider in Malaysia, while CIMB Niaga Syariah, is the second largest Shariah-compliant bank in Indonesia. CIMB Islamic has a complete suite of wealth management and estate planning products and solutions that are tailored to the needs of the Muslim community.
CIMB Group has time and again stressed that it has been able to exceed its growth targets by making full use of the conveniences of digitization, especially by providing seamless and full access to its products. The Group is now in the process of mapping out its next-generation platforms to ensure that these platforms are future-proof, and are able to support the customers and organization, especially in a scenario where the global economy is facing stress.
This article has been compiled based on publicly available information on the web, particularly the bank’s own website.