DBS rolled out digibank in India in 2016 as an all-digital, paperless bank. Michael Power, managing director and COO for technology and operations at DBS Singapore, now says the bank will add more services to the digibank offering, including lending and wealth management.
Digibank has now onboarded 1.6 million customers, which is 33% more since Power last spoke with DigFin at the venture’s one-year anniversary. But to sustain this growth, digibank needs to offer more than attractive deposit rates and an attractive mobile experience.
For now, digibank in both India and Indonesia still offers only basic services: money transfers, bill payment and ATM access. DBS lured customers with higher interest rates, but few have made it their primary bank – and such a change is unlikely so long as digibank can’t offer loans, credit cards, investments or mortgages.
I think 10% is reachable
Power declined to specify when the new businesses will launch.
Attracting clients is one purpose of digibank; another is to cut costs. Last year he told DigFin the costs of traditional operations – processing and administration – could be reduced by 90%. He now reckons those have come down to only 20% of traditional costs.
“I think 10% is reachable,” said Power, adding that this is not about cutting headcount, but eliminating manual processing so the operations team can focus on managing customer behavior and data.
One continuous pain point DigFin had identified was call service: the chatbots were not as popular as the bank had hoped. DBS has continued to improve these, however, and Power now says 90% of enquiries to digibank in India, and 70% of those to digibank in Indonesia, are handled by bots.
The bank is now working on artificial intelligence projects to personalize its chatbots.
China is another market DBS is reviewing to roll out digibank, but this will require a different strategy. Unlike India and Indonesia, where DBS was the first to introduce all-digital banking, China already has this, in the form of Tencent’s WeBank, for example.
“There are many existing competitors at play, so it requires a different strategy,” Power said. “The model may be partnerships with local players and ecosystems.”