Siam Commercial Bank is turning itself into a fully digitized bank:
Siam Commercial Bank is a 100 plus-year-old Thai bank, mandated to provide financial services tailor-made for the requirements of the Thai people. It is now a universal bank, offering deposits and lending and a wide range of other products and services. Its retail services include home loans, personal credit, car hire purchase, credit cards, ATMs, currency exchange facilities and overseas remittances. Its corporate banking services include cash management services, lending products, international trade financing and treasury products. The bank has set up a technology infrastructure that offers extensive support in offering the services.
The bank wanted to become a ‘Most Admired Bank’ in the region and in this pursuit, it has evolved a strategic transformation plan in 2021 to upgrade its infrastructure and enhance its long-term competitiveness. Under this plan, the bank had adopted a ‘Going Upside Down’ approach, whereby it aimed to transform its business model and thinking throughout its human resources, work processes, products and technology.
REINVENTED CUSTOMER EXPERIENCE
In this transformation journey it aimed to create an ongoing, multi-year process entirely based on data-derived insights. It believed this will help it in creating an entirely reinvented customer experience. It partnered with technology consulting firm Accenture to develop advanced data and analytics capabilities with people-focused processes and tools. The first step was the migration of its foundational data repository to Microsoft Azure Cloud. The bank also used Microsoft Power BI to create interactive dashboards for several business areas. And for an efficient cash management, it used AI and ML tools to analyze more than 12 million transactional data points and more than 200 variables – especially to improve the functioning of its ATM network.
The bank has also created a data governance office, an analytics CoE and a bank-wide data stewardship program. And the underwriting and risk management system was totally automated. The end results were 60% reduction in data storage due to compression techniques and 98.8% improvement to ATM service levels.
DIGITIZATION, ONLINE
The bank has digitized 84% of its operations and more than 70% of its transactions volume happened online. It has adopted a cloud-based solution developed by Huawei to digitize its loan services. Customers can apply online, upload documents and receive a quick response. There is very minimal human intervention. The system has helped the bank to be a major player in the large market of small loans.
The additional benefit that the bank could derive is that it could partner with local catering, fitness and healthcare providers to launch embedded financial services.
The bank has developed an efficient credit scoring and income estimation model using ML algorithms to improve its loan approval rates and streamline the whole loan process. It is now in the process of implementing a Digital Wealth model for customers wanting to broaden their investment portfolios.
Overall, it has earmarked a fund of S$28-40 million for IT and digital spending in the next 3 years so that it can develop and upgrade digital financial solutions and offer a full range of online as well as offline services.
The bank has an efficient mobile banking app – SCB Easy. It is today used by more than 15 million users creating more than 400 million transactions every month and offering 200 different services.
EXTENSIVE USE OF AI
The bank has created a well-thought-out plan to use AI to improve its operations and boost digital income to 25% by 2025 compared to 9.9% in the first quarter of 2023. As part of this effort it has introduced an AI underwriting model for the full approval of retail loans, an AI Advisory Chatbot and My Alert, which delivers hyper-personalized investment notifications to customers. Besides, AI tool have helped the bank to streamline work processes across various departments. The ultimate aim is to be an AI-first bank, with AI being used in every facet of operations, including using the ‘Better Brain’ model, which integrates AI into product development, service linkage, and operational enhancement.
The bank insists that customer-centricity is paramount in all its offerings and services. And it has emphasized that it will make use of AI technology in all its banking operations – from product development and service integration to enhancing organizational operational efficiency and bolstering technological acumen among its workforce.
A HUMAN TOUCH
Siam Commercial Bank has recently announced the creation of a ‘Digital Bank with a Human Touch’ and its aim is to convert itself into a fully digital bank by 2025. It is expected that digital banking will become a normal service in Thailand in 3-5 years. The digital banking services now covers savings, loans, wealth, insurance and other financial services.
The bank’s CEO Kris Chantanotoke has said the plan of ‘Digital Bank with a Human Touch’ is intended to make the bank a premier digital bank in wealth management while delivering a seamlessly integrated service experience across all channels for its customers.
This article has been compiled based on publicly available information on the web, particularly the bank’s own website.
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