Banque Saudi Fransi- May 2021 by Business Chief Europe

BANQUE SAUDI FRANSI:

LOCAL BANKING DONE DIFFERENTLY IN ASSOCIATION WITH:

DIGITAL REPORT 2021

BANQUE SAUDI FRANSI

LOCAL BANKING DONE DIFFERENTLY

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BANQUE SAUDI FRANSI

Mike Cunningham, Chief Strategy & Digital Officer, elaborates on the importance of culture and a local approach in Banque Saudi Fransi’s transformation

Mike Cunningham, Chief Strategy & Digital Officer

s practically everyone in the banking sector continues to invest in digital technology, the extent to which a company chooses to focus on culture can often be an important differentiator from the crowd. Better yet, understanding how the latter informs the former’s development can lead to breakthrough innovations. Only the most visionary organisations are capable of producing such results, and Banque Saudi Fransi (BSF) is positioning itself among this distinctive group. Established by royal decree in 1977, BSF was once an affiliate of Crédit Agricole CIB, one of France’s largest banks. Since that time it has become Saudi Arabia’s secondlargest corporate bank and founded an extensive network that includes four primary offices (Riyadh [HQ], Jeddah, Al-Riyadh, and Al-Khobar), 84 branches, 563 ATMs, and over 3,000 employees. Emphasising a teambased structure that maintains a simple and customer-centric outlook, the bank prides itself on an agile ability to create big ideas and execute them effectively. It was this exciting culture that drew Mike Cunningham, Chief Strategy & Digital Officer, to BSF in 2018. “The opportunity captivated me,” he explains. “Being given the chance to be an agent of genuine change and to be a true intrapreneur was too good to miss.” Responsible for five divisions within the bank - Strategy, Strategy Delivery, Marketing alfransi.com.sa

Proudly working with BSF AVA to embrace digital transformation and realise future potential and opportunity WWW

LEBANON

KSA

CYPRUS

Dbayeh Highway Marina Bay Building Dbayeh Lebanon

Al Akaria Plaza Al Ulaya Street Riyadh Kingdom of Saudi Arabia

T. +961-4-417-796 T. +1 (408) 618-6278

T. +966-11-2930-699 T. +966-11-218-2860 T. +1 (408) 618-6278

Victory House 205 Archbishop Makarios Avenue Limassol 3030 T. +357-2504-0000 T. +1 (408) 618-6278

A modern, innovative bank has to think differently to defend its competitive advantage, in a world where new market entrants are challenging the traditional financial services model, emboldened by technology innovation and a regulatory environment which is shifting to accommodate new ways of serving customers. Banque Saudi Fransi has proved that agile thinking and a willingness to adapt are key to success for a bank whose account holders might be tempted by the fully digital experience offered by challenger banks and payment service providers. BSF has opted to address the threat by working with technology partner eMcREY on a key project to help deliver digital transformation. This is part of a new generation of customer-centric banking solutions linked to the rapidly developing external digital financial services ecosystem in the Kingdom of Saudi Arabia and beyond. What BSF has demonstrated is that true digital transformation goes far beyond adding new digital services in response to market opportunities or immediate threats. Transformation involves a visionary approach to reassessing the scope and ambition of the core business, implementing a digital-first culture and re-imagining the value proposition to proactively anticipate customer needs. Technology is integral to this way of thinking, says eMcREY CEO, Mona Yahchouchi. The future is about embracing collaboration and partnerships, as well as adopting a mindset that is open to learning from those who are making waves in the industry. eMcREY has significant expertise in developing digital solutions for the financial services domain, with projects at many of the leading banks in the Kingdom of Saudi Arabia and the Middle East region. The company has worked closely with BSF on its digitization journey, as a partner on the bank’s AVA project, which will see BSF launch its own challenger bank on a separate platform and under the new brand. Designed as a mobile-led service and targeting digital native millennials, the new bank is a significant milestone for banking in Saudi Arabia, clearly signalling the Kingdom’s intention to lead rather than follow in the field of digital financial services and compete with best-in-class fully digital providers. AVA includes innovative features that will certainly make it attractive internationally, not only to customers within the Kingdom. This includes a digital wallet which will be integrated with global payment schemes for worldwide acceptance. eMcREY was chosen to partner with BSF thanks to the speed to market achievable using its Software as a Service (SaaS) subscription-based licensing and delivery model. The company has considerable expertise in delivering a range of business-critical digital implementations in the Kingdom, linking financial institutions to national, regional and global payments

infrastructure. An integrated end-to-end platform for virtual payments, the SaaS solution creates a proven foundation for growth and unlimited scalability across a complete range of payment services. Mona Yahchouchi says that the speed with which financial institutions in the Kingdom are innovating is impressive. Banks have recognised the need to define agile strategies to enable rapid and seamless delivery, focused on building strong relationships with customers and increasing revenue by introducing new services. Going forward, reputations will be established on the ability to innovate and willingness to embrace the next generation of new technologies. Security of transactions and customer data will be key to success, along with a focus on omnichannel payments strategies as the differences between payment types and markets become increasingly blurred. In technology terms, this means handling real-time account-to-account transactions and rapidly growing volumes of contactless and mobile payments. It calls for robust back-office solutions for customer acquisition and authentication, alongside scalable acquiring and reconciliation capabilities. There are new possibilities presented by blockchain and cloudbased, on-demand payment services; but there are also challenges associated with compliance and customer demands in an increasingly global payments market. Since 2006, eMcREY has been using state-of-the-art technology as a powerful force for creativity in KSA. A Saudi company with offices in Riyadh, Dubai, Canada, Cyprus and Lebanon, eMcREY delivers dedicated solutions for financial services, government and fastgrowing market segments such as smart energy and smart transport to help achieve Vision 2030 goals. Its 200+ specialists in the Kingdom have built a reputation for strong technical expertise, commitment to customer service, quick-to-market solutions and excellent support for ambitious, future-focused businesses. “Our collaboration with BSF has been exciting and fruitful,” concludes Mona Yahchouchi. “It is one of a number of key projects that are really beginning to show the results of Vision 2030 investment in the financial services digital ecosystem. We look forward very much to extending our work with BSF and helping them to fulfil their own dynamic, customer-centric vision.”

For more information about eMcREY products and services please visit www.emcrey.com or email info@emcrey.com

“ BSF is known as the ‘relationship bank’ because we’re more inclusive: we’ve stopped thinking like a big bank and now everyone has a voice” MIKE CUNNINGHAM

CHIEF STRATEGY & DIGITAL OFFICER, BANQUE SAUDI FRANSI

& Corporate Communications, Customer Experience, and Digital - Cunningham calls BSF’s employee value proposition “captivating” and a natural incubator of entrepreneurial vitality. An experienced leader in the EMEA banking sector as both an executive and mentor, he speaks with authority about the company’s superior cultural offering, “In my 25-plus years of work, I’ve never been made to feel so welcomed, so appreciated, or so integral to an organisation; it's like my home away from home.” For BSF, success is dependent on establishing a clear vision and then assembling the right team to carry it out. Taking a ‘servantleadership’ role in managing its employees, which includes giving them the space to try out new ideas, the company has a “no BS [big shots]” policy when it comes to teamwork: each member is critical to generating a positive outcome. According to Cunningham, the challenges of modern banking make this highly collaborative philosophy indispensable, “Regulation, fragmented value chains and digital; when you add these three together, you can not only see how the cost of compliance has hit banking’s cost base but also how our 8

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entire business model is being commoditised.” Recognising the writing on the wall, BSF has subsequently begun moving with the changes, fast. When it comes to digital transformation, however, Cunningham is quick to point out that this alone doesn’t give BSF an advantage, “Having real differentiation in that regard is very difficult; most banks just look at what competitors are doing and copy them.” However, BSF is determined to go one step beyond by actively listening to customers and implementing the changes that they actually need. BSF’s approach to developing products and services is much more akin to the agility seen in startups than legacy bank brands, yet this cultivated unconventionality is exactly why it prioritises the customer experience (CX) above all else. This is also where the bank’s storied reputation within its national community becomes invaluable, “we're part of the fabric of the Kingdom’s society, which we've achieved by staying close to our customers. BSF is known as the ‘relationship bank’ because we’re more inclusive: we’ve stopped thinking like a big bank and now everyone has a voice,” he explains.

BANQUE SAUDI FRANSI

BSF’s Digital Transformation Journey & Digital Banking Futures

MIKE CUNNINGHAM TITLE: CHIEF STRATEGY & DIGITAL OFFICER INDUSTRY: BANKING

EXECUTIVE BIO

LOCATION: SAUDI ARABIA Mike is a thought leader and digital practitioner of innovation within financial services and has an unmatched global network with the world’s leading VCs, FinTechs, Accelerators and the established corporates. He mentors new FinTech start-ups at two of the region’s leading accelerators in Saudi and Lebanon. Before joining Banque Saudi Fransi, Mike attempted to build the UAE’s first ‘standalone’ digital challenger bank. With no appropriate licensing framework, it was three years too early and Mike had to concede round one. Prior, Mike was Executive Vice President at Abu Dhabi Commercial Bank where he led Group Strategy and Innovation. Before that he

worked for Barclays in Europe, Asia, Africa and the Middle East where he led the de-novo market entry and establishment of Barclays in India, Pakistan and Namibia. With his 25+ years of financial services experience, Mike has a deep understanding of building and innovating digital financial services in emerging markets and coupled with his track record in customer experience transformation and his global network, is ideally placed to create the region’s preeminent digital first bank. Mike has lived and worked all over the world and now resides between Saudi Arabia and the UK with his young family.

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Mambu and the UAE’s digital banking journey Miljan Stamenkovic, Mambu’s General Manager for MENA, talks technology and digital transformation In his current role as Mambu’s General Manager for MENA, Miljan Stamenkovic sees opportunity in abundance.

providers and cloud adoption. But this past year has been a wave of progress.”

“When I joined Mambu with my team in 2019, we came with the fintech, entrepreneurial mindset and DNA to build and grow Mambu’s business in the MENA (Middle East and North Africa) region. Before 2019, the region used to remind me of a desert, at least in terms of cloud service

He explains, “There are data protection laws. There are cybersecurity regulations and most importantly, a variety of major tier one cloud service providers that are available. But what particularly excites me here at Mambu is the opportunity to rethink business models together with our clients and really bring them to life.”

"Banks used to be built to last, but today they need to be built to change. And that's what we're enabling here." —

Creating a neobank and challenger bank ecosystem has been his ultimate goal. “In my opinion, this actually creates a unique opportunity to partner with some of the best fintechs in the region and build the region’s first and true challenger and neobanks.”

Miljan Stamenkovic, Mambu’s General Manager for MENA

Stamenkovic credits Mambu’s partnership with Banque Saudi Fransi (BSF) for the success that has driven the bank forward in the region. “When I think about all the challenger and neobanks that have grown massively over the past decade, there is one common denominator for all these new initiatives. I would say they really operate like a tech company rather than a bank – BSF is leading this approach in Saudi Arabia.” He adds that Mambu is helping BSF deliver an entire new banking experience while providing soft core banking services. “Mambu enables banking like a modern tech company. Banks used to be built to last, but today they need to be built to change. And that's what we're enabling here.”

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BANQUE SAUDI FRANSI

EMcREY: MORE THAN A MATCH FOR BSF

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DID YOU KNOW...

From all of BSF’s hardworking and valuable partners, Cunningham singles out tech solutions expert eMcREY as being particularly important to the company’s ongoing digital transformation. Calling it a “fabulous partner,” he endorses eMcREY as being the epitome of expertise in its field: “There's no payment company anywhere on the face of the planet that understands Saudi Arabia better than eMcREY. “It powers all of our payments infrastructure and is even taking care of BSF’s new digital ventures’ processing. eMcREY behaves like a startup, possesses the venture spirit for which we were looking, and it’s also helped stop the bank from making the mistakes that others have made. It's been great to have eMcREY on board.”

The primary challenge for BSF as it develops further digital capabilities, Cunningham continues, is one experienced everywhere: a shortage of experienced talent. Despite the scarcity being magnified in Saudi Arabia, he insists that the bank has overcome this in two ways: 1) Importing the world’s brightest and best and winning them over with BSF’s culture; and 2) Launching its own digital engineering apprenticeship. No longer seeing the utility of maintaining large data centres, BSF favours migrating its infrastructure to the cloud and adopting software as a service (SaaS) platforms. However, Cunningham states there is still an element of waiting for big tech and global cloud players to arrive in Saudi Arabia, allowing it to catch up with BSF’s ambition, “cloud options within the Kingdom are

BANQUE SAUDI FRANSI

“BSF captures the voice of the customer, looks across all of our different customer journeys, and tries to find ways of removing friction” MIKE CUNNINGHAM

CHIEF STRATEGY & DIGITAL OFFICER, BANQUE SAUDI FRANSI

limited at this time. I think that hinders our ability to innovate at the pace that we want. The Saudi Central Bank has been amazing in opening the doors for digital banking. It’s got a great sandbox, not necessarily just for testing new products but also in terms of challenging and testing current and new regulations.” It’s safe to say that BSF’s ultimate goal is to be nothing short of Saudi Arabia’s digital finance nexus, but Cunningham clarifies that there’s still some way to go. 2020, by dint of the COVID-19 pandemic, was an important test of its digital integrity and values, both of which passed with flying colours. “We were already set up to operate remotely. BSF’s first response was to look after our people, be there for them personally, and make sure that they received the support needed. What

the pandemic has done is accelerate our digital plan and placed a renewed emphasis on digital and mobile channels.” Therefore, 2021 and beyond will serve to realise the fulfillment of that new vision, including the development of ‘Project AVA’ - BSF’s own digital challenger bank. With details still kept tightly under wraps for now, Cunningham calls the project an effort “by Saudis, for Saudis” that will go beyond being a mere replication of successful brands elsewhere. The bank will accomplish this by leveraging its close connections with the community and a campaign of ‘hyper localisation.’ Indeed, BSF understands its customer demographic well enough to know that “just lifting something up from one country and dropping in the other” won’t work. Different markets have different needs, and BSF, whether considering new product launches or technologies in which to invest, always has the end-user in the mind. “Mobile technology could fundamentally create a shift in not only the products, services and features that we have, but also our business and operating model,” states Cunningham. “Those benefits could be in terms of improved risk management for the institution, a better employee and customer experience, or better economics.” alfransi.com.sa

BANQUE SAUDI FRANSI

“ We're part of the fabric of the Kingdom’s society, which we've achieved by staying close to our customers” MIKE CUNNINGHAM

CHIEF STRATEGY & DIGITAL OFFICER, BANQUE SAUDI FRANSI

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BANQUE SAUDI FRANSI

1977

YEAR FOUNDED

Banking INDUSTRY

3,000+

NUMBER OF EMPLOYEESS

USD 1.9bn REVENUE

As the availability of Saudi Arabia’s cloud infrastructure continues to develop, BSF is poised to take a prominent position in the country’s new banking industry. Calling the organisation a “universal bank” that attends to SMEs, large corporations, retail, private and underbanked individuals with equal drive and determination, Cunningham remains highly positive about the BSF brand’s future growth potential. “Culture and talent represent 80% of the digital iceberg,” he concludes. “BSF believes in finding people that think and work differently in order to create a culture that sets up the business for success. No one should settle for ‘second best’ in talent; I'm a big believer that the best talent attracts the best talent, period.”

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Banque Saudi Fransi T 800 124 0006 alfransi.com.sa