Big four banks laud digital banking uptake amid COVID-19

Simnikiwe Mzekandaba
By Simnikiwe Mzekandaba, IT in government editor
Johannesburg, 02 Jul 2020

South African banks have witnessed bolstered use of online and digital banking channels amid social distancing protocols because of the coronavirus (COVID-19) crisis.

As of this morning, South Africa had recorded 159 333 coronavirus cases, with deaths reaching 2 749 and recoveries standing at 76 025.

The uptake of digital banking channels is expected to be heightened even more as the country approaches the peak of its COVID-19 infections in the coming weeks.

Four of the country’s big retail banks say they have seen a spike in use of digital wallets, contactless payments, mobile apps and unstructured supplementary service data (USSD) payments, to name a few services.

Prior to the COVID-19 crisis, local banks were already, in some way or another, prioritising digital banking solutions to keep up with the continuously evolving digital space.

Since the COVID-19 lockdown commenced, the Absa Group has noted a strong uptake of its digital channels. Furthermore, in line with global payment trends, the bank expects an increase in contactless payments, which include wallets, according to Tshiwela Mhlantla, managing executive for physical channels at Absa retail and business bank.

“We have also noted growth in contactless payments, as a consequence of the COVID-19 pandemic and in keeping with provisions for social distancing, as customers seek to avoid contact with payment devices while also mitigating the need to hand over cards.

“As the payments environment evolves and customers continue to adopt mobile technology, we anticipate that wallets will be more widely adopted and will complement the use of plastic cards.”

For Nedbank, digital sales have grown more than 167% year-for-year (May) and the total volume of payments and transfers on its money app year-to-date (May) is up 7% compared to last year.

“We’ve seen a growth in money app and USSD [usage] specifically over the last quarter,” says the financial services provider.

Even though First National Bank (FNB) branches are available to customers in line with its responsibility to provide essential services, the bank encourages customers to make use of its digital channels.

Lee-Anne van Zyl, CEO of FNB Points of Presence, says: “As the economy is re-opening, we continue to see improving digital interactions by customers in areas such as payments, send money and other day-to-day transactions. Furthermore, we remind customers that they do not incur data costs while using our app and that they simply require an active Internet connection.”

Standard Bank also urges its customers to adopt digital options such as its mobile banking app, or transact on Internet banking during this time. “Our digital services are more than capable of providing services and functionality to our customers.”

Virtual ‘plastic’

To enhance the customer experience during the lockdown period, some of the banks have either updated their digital services or enabled new ways to transact.

Absa notes it unveiled a “key milestone” in its digital payment journey a few weeks ago. The bank is following a phased-approach to deliver a fully integrated virtual card offering that will enable a number of mobile payment options.

“As part of the first phase, customers get a digitally issued card with their card details displayed in the Absa app,” says Mhlantla. “They can view their full debit and credit card details, which include the 16-digit PAN (personal account number), CVV and expiry date.

“This will enable customers to start transacting without ‘physical plastic’ by using the details available in the bank app to enter their card details on external e-commerce platforms. Customers will receive an authentication message to view the details, and will be able to view all cards linked to their profile. This will enable customers to load or capture their card details and make payments from other payment apps such as PlayStore, Netflix, SnapScan, Uber and Deezer. Customers can now immediately use their card for online transactions as soon as it has been issued.”

Nedbank introduced a new banking app called Avo. The bespoke e-commerce platform allows customers to sign up securely and access essential goods such as groceries, delivered directly to their homes safely.

“Also available on Avo are essential healthcare services, online shopping for medical essentials, fulfilment and delivery of over-the-counter scripts, home repair services, and crucially during periods of extended lockdown, digital home entertainment services, with vouchers for music, gaming and video on-demand services.”

Continuous banking

Navigating the COVID-19 pandemic has not been easy for the banks, with some temporarily closing branches in some parts of the country as the number of infections continues to rise.

Standard Bank says it has introduced numerous measures and processes to ensure customers can access services in a seamless and uninterrupted manner.

“Our employees, systems and processes have been adapted to ensure compliance with all the health protocols and laws as they pertain to COVID-19.

“As a consequence, almost 75% of Standard Bank employees are currently working from home. As an essential service, Standard Bank takes its duties and responsibilities to our customers and the broader South African economy extremely seriously.

“Standard Bank will continue to monitor and adapt its business practices and processes to prevailing conditions, with our priority being the health and safety of our staff and customers. From time to time and when deemed necessary, staff and services may be called upon to operate from different locations, or branch services may be diverted to other geographically convenient locations. We are acutely aware of the potential negative impact that this may have.”

On whether it is planning any temporary closures of branches, Nedbank says it will continue to do everything to protect staff and clients who come into its offices. “Branches may be temporarily closed from time to time, as the need arises.”

According to Absa’s Mhlantla, the grim reality of the COVID-19 pandemic has created extraordinary circumstances and requires the adoption of dynamic approaches to branch management.

“Absa has prioritised the health and safety of all our colleagues and customers, and to-date, all our branches and offices have been subjected to increased hygiene requirements, regular sanitising and social distancing protocols. We have experienced branch closures across the provinces in which we operate, but these have been few and in response to suspected cases of COVID-19 infections. Where this has been the case, we notify the relevant authorities and ensure rigorous deep cleaning of the branch.”

FNB’s Van Zyl says the bank continues to support efforts to contain the spread of COVID-19 and is actively monitoring developments across the country.

“The wellbeing of our staff and customers is our utmost priority. As a result, we have adopted stringent precautionary measures in all our branches and campuses.

“Furthermore, we continue to remind all employees who can work from home to continue doing so, especially those who are considered vulnerable by the Department of Health.”

For employees who have to use FNB premises as part of providing essential services, Van Zyl says precautionary measures have been introduced.