Presentation on theme: "Sustainable Banking Channel- BSN Agent Banking Azaddin Ngah Tasir Senior Vice President Bank Simpanan Nasional (BSN) Global Sustainable Finance Conference."— Presentation transcript:
Sustainable Banking Channel- BSN Agent Banking Azaddin Ngah Tasir Senior Vice President Bank Simpanan Nasional (BSN) Global Sustainable Finance Conference 2013 4 & 5 July 2013 Karlsruhe, Germany
2 Malaysia Factsheet General Capital: Kuala Lumpur Population: 29 mil Official language: Malay Ethnic groups: Malay 50.4% Chinese 23.7%, Indigenous 11%, Indian 7.1% Others 7.8% Political Government :Federal constitutional elective monarchy and Federal parliamentary democracy Legislature: Parliament Upper house: Dewan Negara Lower house - Dewan Rakyat Economic Real GDP (%): 4.1% (Q1 2013; 5.6% in 2012) Inflation (%): 1.8% (May 2013; 1.2% in Dec 2012) Unemployment: 3.3% (Mar 2013) Total trade Jan 2013: RM110.7 bil (€26.4 bil) Top 5 trading partners: Singapore (16%), China (14%), Japan(10%), EU (9%), US (8%).
59 Micro Finance Centres 995 ATMs 283 CDMs >700,000 SMS Banking Users >350,000 Internet Banking Users >6,600 Employees 258 CDMs 10 Mobile Banking Units As at 31 Mar 2013 > 8.2 mil customers 3 398 Branches nationwide of which: 8 full-fledged branches 118 social branches of which 45 operate where no other banks operate BSN – National Savings Bank of Malaysia Established under BSN Act 1974 to take over the functions and responsibilities of the Post Office Savings Bank.
4 Member of World Savings Bank Institute (“WSBI”) (previously “International Savings Banks Institute”) since 1977. Our Chief Executive is serving his 4 th term as President of WSBI Asia Pacific. Member of the Association of Development Finance Institutions of Malaysia (“ADFIM”) established in 1981. Our Chief Executive is the current Chairman of ADFIM’s Liaison Committee and Treasurer at ADFIM Council. Accepted on 6 Nov 2012 as an Associate Member of Association of Development Financing Institutions in Asia and the Pacific (“ADFIAP”). BSN’s Memberships
5 BSN’s Objectives Mandated Roles & Financial Inclusion Promote savings and financing micro enterprises. Lend support to the Malaysian Government’s Blue Ocean Strategy and the Central Bank’s (BNM) financial inclusion agenda where all Malaysians will have access to banking products & services. Generate Profits for Sustainability To continue evolving in order to remain relevant in the industry so as to generate profit to take care of the well- being of the staff and carry out our mandates.
6 BSN’s Financial Inclusion Agenda Underserved Communities Non- urban areas Non-economical areas Low population Mandate to BSN: Provide financial access A better way… Cheaper cost to serve Scalability Outreach
8 BSN Agent Banking Officially launched on 27 Jan 2012 - initial 200 agents
9 BSN Agent Banking Officially launched on 27 Jan 2012 - initial 200 agents Recruitment of Retail Outlets as Agents
Why Retailers? It has own core business Trusted by the community High foot- traffic Proximity to customers Minimal training required It has own active cash flow Agents’ Criteria Registered Company - min. 12 months in operation GPRS coverage Good Financial Record 5km radius from the nearest BSN Branches. 10km radius from other agents. Suitable building infrastructure 10
11 BSN Agent Banking Officially launched on 27 Jan 2012 - initial 200 agents Recruitment of Retail Outlets as Agents 5 Basic Banking Services
12 Banking Transactions Offered * Whichever comes first The account opening function via P.O.S. will be available by end 2013.
13 BSN Agent Banking Recruitment of Retail Outlets as Agents Officially launched on 27 Jan 2012 - initial 200 agents 5 Basic Banking Services Innovative use of technology
14 P.O.S. for Banking The Point-of-Sales (P.O.S.) terminal is widely used Agent may have experience using it Ability to complete transactions from any geographical location Increased performance with minimized transaction completion time Prints bank-acknowledged receipt at the end of every transaction
15 Banking transactions performed via wireless GPRS at P.O.S. terminals provided by BSN to its agents. Customers confirm their Personal Identification Number (PIN) and a biometric verification is done before initiating their transactions. A receipt will be generated upon any successful transaction. Transaction Switch / Middleware and BSN Host/System GPRS Network and / or Fixed Line P.O.S Terminal Customer and / or Agent How does it Work?
16 BSN Agent Banking Officially launched on 27 Jan 2012 - initial 200 agents Recruitment of Retail Outlets as Agents 5 Basic Banking Services Innovative use of technology Towards Green Banking
Traditional Banking Practice 17 Customers visit branches Form-based Form-based Manual input Manual input Fixed line Fixed line Longer process Longer process Online Real-time Online Real-time Towards Green Banking 398 branches Bring the Bank to the Community Formless Formless Automated Automated Wireless GPRS Wireless GPRS Simplified process Simplified process New Banking model
18 BSN Agent Banking Officially launched on 27 Jan 2012 - initial 200 agents Recruitment of Retail Outlets as Agents 5 Basic Banking Services Innovative use of technology Towards Green Banking Socio- economic impact
19 Impact to the country: Fulfillment of the Central Bank’s Plan* on Financial Inclusion Underserved449Underserved449Served388Served388 46%46%54%54% TotalSub-District837TotalSub-District837 Before Agent Banking *BNM’s 10-year Financial Sector Master Plan (2011 – 2020) After Agent Banking Underserved184Underserved184Served754Served754 90%90%10%10% TotalSub-District837TotalSub-District837
20 Impact to Agents and Community Additional foot-trafficAdditional foot-traffic Reputation from affiliationReputation from affiliation Additional revenueAdditional revenue Financial ManagementFinancial Management Synergistic partnership with BSNSynergistic partnership with BSN Access to micro financing for business expansion Agents Access to Banking for the underservedAccess to Banking for the underserved Saves travelling time and cost Alternative, convenient access for urbanitesAlternative, convenient access for urbanites No queues, average transaction time = 7 secs Banking + Cashless Purchases Extended banking hours (8.00am- 10.00pm, 7 days a week)Extended banking hours (8.00am- 10.00pm, 7 days a week) Community
21 Impact to BSN Revenue growth Transaction growth steadily increasing since launch as public awareness and acceptance of agent banking channel increases Increased visibility Widespread locations of agents have increased visibility of the Bank more effectively than having a physical branch. New customer segment With 23% presence in urban areas, BSN agent banking is attracting the urban middle to high income to bank with BSN.
22 Impact to BSN Cost effective set up and operations Rapid expansion Jan 2012 200 Agents June 2012 1,500 Agents Dec 2012 3,660 Agents May 2013 4,044 Agents
23 Impact to BSN Trx Value RM561mil (€134 mil) Trx Count 6.3mil No. of Agents 4,044 Overall Performance as at 31 st May 2013
24 BSN Agent Banking Officially launched on 27 Jan 2012 - initial 200 agents Recruitment of Retail Outlets as Agents 5 Basic Banking Services Innovative use of technology Towards Green Banking Socio- economic impact Sustainable development
25 BSN Agent Banking & Sustainable Development Supports the Government ‘s National Agendas National Blue Ocean Strategy (Cost effectiveness, rapid expansion, high impact) Financial Inclusion Expansion & development of local communities BSN agents are also agents of growth in their communities Knowledge of IT and banking Reduces BSN’s carbon footprint Minimise need for brick-and-mortar branches Promotes formless and cashless banking Perpetual demand for basic banking services sustains the agent banking business model BSN can continue to carry out its mandated roles more extensively The Nation Communities & BSN agents EnvironmentBSN
26 Our Implementation Focus Public Information & Awareness SignageSignage Promotional Items TV Commercial / Interview Community Events: FOMCA & BNMLINK 24-Hour Customer Service Hotline Agent Knowledge & Support Agent Knowledge & Support New & Refresher Agent’s Training On- Ground Support On- Ground Support Agent Helpdesk – Toll-Free Line Social Media - Facebook Social Media - Facebook Bulletin Road Shows