Changing customer expectations and new digital innovations are compelling banks and financial companies to embrace new technologies to build winning strategies. Mashreq Global Services (MGS), a wholly owned subsidiary of Dubai-headquartered Mashreq Bank, the oldest private bank in the UAE provides exclusive technology services to Mashreq. Since inception in 2005, MGS has grown steadily to become a strategic contributor to the bank’s ongoing growth and success. Today, almost all their technology developments are done in Bangalore, over the last few years. Today, the company is incubating seven start-ups in India, in areas such as data analytics, robotics, machine learning, etc. and is also expanding its India presence. In an exclusive interaction with CXOToday, Santhosh Mahalingam, MD, Mashreq Global Services, explains the latest technology trends and challenges in the banking industry and MGS’ plans for the India market.
CXOToday: How do you see the impact of digital transformation on the future of banking and financial services?
Santhosh Mahalingam: Technology has revolutionized the way we do banking. We will see an emergence of radically transformed banking models. Open Banking will lead its way and will make it easier for banks to collaborate with Non-traditional alliances and FinTech leaders, which will lay down superior standards of next generation financial services by providing instant fulfillment to customer transactions.
CXOToday: What challenges do you think digital transformation and artificial intelligence impose on the financial services industry, especially at the level of regulating the industry?
Santhosh Mahalingam: Currently enterprises globally are embracing the revolutionizing technology of Artificial Intelligence, Robotic Process Automation and Cognitive opportunities. These technologies are introducing a new workforce, what we call “Digital Workers” into the workplace. Digital workers are Cheaper, Faster, Scalable and Multi-skilled. The organization need to retrain and Upskill their managers and supervisors on how to manage the Digital worker along with the Human worker.
The very innovation that drive Customer service and Business growth also create first order Cyber Risks for the banks and their customers. Cyber risk, while not at all new, has rocketed up the list of leading issues for banks. In the last couple of years, technologies such as Digital Wallets, EMV Chip-based Cards, and two factor authentication via SMS-based One Time Password (OTP) have helped the banks to implement security controls to mitigate traditional cyber risks. However, as the technology has evolved, attack vectors have also become more sophisticated. There is a need to also be constantly vigilant and resilient in face of evolving data thefts, fraud and security breaches.
CXOToday: What are the areas Mashreq has invested in, as part of its growth plans in India?
Santhosh Mahalingam: We are incubating seven start-ups in India, in areas such as Data analytics, Robotics, Machine Learning. India has been very active in creating a healthy start up ecosystem, and the growth in the number of start-ups is increasing year-on-year.
CXOToday: What does this technological change mean for the way banks operate?
Santhosh Mahalingam: At Mashreq, we started embracing this latest wave of digital transformation about two years ago and as a result, we have put in place fairly robust infrastructure on robotics and artificial intelligence. We have close to 300 robots performing over 100,000 transactions every day.
Over these two years, we have built an inventory of digitalized processes such as account opening, fund transfers, statement requests, checkbook requests, trade finance, and so on. Based upon the shifting demand during the course of the day, week, end of the month, we have to re-balance these robotic workers.
CXOToday: Please shed some light on Mashreq’s expansion plans for India?
Santhosh Mahalingam: We are in the process of enhancing our workforce and have already recruited 500 people this year. By the end of this calendar year, we will be 1000 people strong company. We are expanding and have taken up a new facility in Bangalore.
Apart from technology support, we are looking at Bengaluru to develop capabilities in areas like Risk Management, Business Intelligence and designing our financial products out of India. We are also looking at hiring senior global bankers to the leadership team at MGS.
CXOToday: Why are AI & Robotics important to Mashreq’s futuristic drive?
Santhosh Mahalingam: Banks are stepping up their game across their operations and services. Today, Digital transformation, Robotics and Artificial Intelligence have given banking sector with important tools to deliver better banking services to our customers. Around 97% of Mashreq’s retail transactions are already occurring outside the branch. Many services have been automated, which has led to an increase in the offer and value that banks give to customers. The AI brings with it reliability, 24×7 availability and they are also scalable to manage the seasonal volume fluctuations thus increasing productivity. Mashreq understands and recognizes this and will continue to invest in AI & Robotics to drive innovation across its services and offerings.
Customers are looking for quicker and reliable services. Robotics & AI will bring in instant fulfillment of transactions. All these transactions processed by Robots will leave a digital footprint. This will provide transparency to customers.