African Bank in COVID-19 digital transformation offensive
African Bank is using its team of data scientists to fast-track its digital transformation journey during the COVID-19 lockdown.
So says Penny Futter, chief information officer of African Bank, who notes that many companies find themselves in an uncanny situation where COVID-19 has been the unexpected catalyst for digital adoption.
This as South African banks are witnessing a sharp decline in customers visiting branches amid fears of the spreading coronavirus.
The coronavirus outbreak came at a time major South African banks were already shutting down branches while encouraging users to switch to digital alternatives.
Headquartered in Midrand, African Bank has a countrywide branch distribution network in addition to a digital channel offering.
According to Futter, this year African Bank increased its team of data scientists to 57 full-time employees.
She believes the use of data supports some of the bank’s business objectives to provide services and products that customers need and value as well as to improve customer satisfaction.
“Since the bank’s launch in 2016, we have emphasised and developed our digital technology to offer easier and more convenient platforms for customers to engage with us,” Futter says. “There is, however, no doubt that the COVID-19 lockdown has accelerated our digital adoption.
“Since the lockdown, our customers have moved to using the digital channels so they can continue to be serviced by the bank.”
She notes the bank’s statistics reveal consumers’ appetite to adopt digital channels to continue self-servicing during times of restricted physical movement has increased.
The African Bank banking app was launched in January 2019 and downloads of the app had grown by over 1 000% by April 2020, with 90% Android users and 10% iOS users, says the bank.
It adds that registrations on its online platform have grown by over 220% during the past year.
“The chatbot, Karabo, is handling some 31 000 interactions per month with African Bank and we are targeting 85% of all servicing functions to be fulfilled on Karabo by 2022.”
Futter comments that this technology is using the latest in supervised artificial intelligence learning to enhance human-machine relationships.
The utilisation of value-added services, which is the purchase of airtime, data and electricity, has also increased by 244% over the past year, the bank notes.
It points out that its branch network remains a core distribution channel to its service offering even with the adoption of digital by customers.
“South Africa has an estimated unbanked or under-banked population of some 11 million people. The majority of these people do not use digital technologies due to limited access to such technologies, limited education on how to use them or data cost,” Futter says.
The lockdown has also thrown up an increase in interest in people navigating their financial well-being, says the bank.
Google’s Quarterly Business Review for 2020 noted an increase in investing activities of 25% across South Africa.
According to African Bank, consumers are holding back on discretionary spending and showing more interest in risk-mitigating financial products.
“What this means for an emerging digital challenger like African Bank is that the agility that we have built into our digital solutions and low-cost operating models allows us to continually adapt the nature of the financial services that we offer. Furthermore, it enables us to influence the rapid adoption of these services across our digital platforms,” concludes Futter.