Building the bank of tomorrow Video Credit: Supplied

Highlights

Abdul Aziz Al Ghurair, CEO of Mashreq Bank, on why transformation is necessary to face disruption in the financial sector

Financial institutions in the UAE must go on the offensive and use digital technology to build the bank of the future, as technology is already enabling new-age innovators to come up with solutions that will disrupt the whole industry.

“All institutions want to become digital banking leaders, but only those who are deeply engaged in transformation will get there,”

- Abdul Aziz Al Ghurair, CEO of Mashreq

Abdul Aziz Al Ghurair, CEO of Mashreq, one of the leading banks in the country. As one of the UAE’s most eminent bankers, Al Ghurair and his family have been at the heart of the financial and economic development of the Emirates for several decades.

“I think in the financial sector we keep looking at our competition and we look at the banks. Over time, I am afraid banks will not be competing with banks anymore. There will be new competitors coming in and we have to prepare for that day.”

Abdullah Al Ghurair, Abdul Aziz’s father, co-founded Mashreq in 1967 and Abdul Aziz Al Ghurair has remained its hands-on chief executive since 1993. He is also chairman of the UAE Banks Federation, the trade association that speaks on behalf of the industry to governments and other federal bodies, such as the UAE Central Bank.

Ready for change

“All businesses need to evolve because the world is constantly changing,” says Al Ghurair. “We have seen organisations who have not been able to transform – they are stuck in their old model. Their market share is dwindling, and only through innovation and transformation at any organisation you start retaining your customers and growing your market share.”

Powerful forces are reshaping multiple industries as technological advancements create new global giants such as Uber, YouTube and Airbnb who don’t own any of the underlying assets they sell. It is not far off to expect similar new entrants in the UAE financial services industry, predicts Al Ghurair. “They will be coming even in the banking industry. We will see customers taking their banking services from banks not even licensed in the UAE.

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Mashreq is investing in technology to transform internal capabilities Image Credit: Supplied

“Today, who stops me from going online to open an account with a US or UK bank? Such digital banking solutions will come up over the next three years.”

Own the disruption

To stay ahead of the game, business leaders will have to be able to anticipate and own disruption, says Al Ghurair. “Some CEOs believe in that and some CEOs may be forced to undertake some transformation. I can tell you that people who are forced to adapt to these changes will not survive for long.”

The availability of numerous digital platforms such as smartphones, tablets and mobile applications means customers’ expectations of how they interact with the bank are changing. Today customers are willing to switch loyalties to enjoy a superior experience, says Al Ghurair. “Size is not the only factor to determine the winner – speed, agility and superior customer experience can make even a smaller player the biggest winner in the race,” he adds.

People power

It is also important to evolve a different culture inside the business as part of the transformation agenda, explains Al Ghurair. “I think any organisation needs to work on its culture. We are very strong in ensuring that Mashreq has its own unique culture. For any leader, once you get the top job, you need to have a vision.

“You have to ensure that vision is owned by every single individual in the organisation. You have to mobilise them, encourage them to deliver on the vision.”

Mashreq, which is celebrating its 50th anniversary this year, is one of the most active lenders in the UAE. It sees investments in technology and digitisation as a key area to prepare for disruption. “Innovation is part of our DNA from inception until today,” says Al Ghurair.

Technological investments

Significant investments in artificial intelligence, robotics and technology over the past two years means Mashreq is lessening its reliance on human resources as it prepares for the digital future. “In the past two years we started using artificial intelligence robotics. Over time, some jobs will be replaced by either digitisation or robotics and artificial intelligence.”

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Customers’ expectations of how they interact with the bank is changing Image Credit: Supplied

The know-how of artificial intelligence is becoming more available and it will replace simple, repetitive jobs at the bank, explains Al Ghurair. “Why do we want to use this technology? Because it is scalable, predictable and efficient. There are almost zero mistakes when you use these tools.”

Mashreq is also undertaking an intensive exercise to transform and digitise its internal capabilities, says Al Ghurair. This includes automation of requests through front-line staff at the branch, which the bank hopes will help avoid manual paperwork and save on recurring costs every year.

The digital revolution is in some ways similar to the Industrial Revolution two centuries ago, or the advent of computers, which created market disruption. While the initial reaction by people was one of job-loss fears, in reality, such revolutions created many more new jobs and professions they eliminated.

Mashreq believes firmly that the digital revolution will lead to more fulfilling, challenging and rewarding jobs being created, while robots will take care of the mundane, repetitive and boring tasks. That is the real positive impact of disruption.

Building the bank of tomorrow Video Credit: Supplied