People’s Bank digital strategy: enabling growth amidst a crisis
By leading the digital transformation, People’s Bank has set the platform for a faster recovery and growth.
Chief Executive Officer and General Manager at People’s Bank, Ranjith Kodituwakku discusses the bank’s digital transformation, and how its focus on innovation helped the bank navigate the uncertain period post Covid-19 to achieve probably its best financial performance for any given year, and also set up the platform for future growth.
Can you briefly tell us about People’s Bank’s digital journey?
People’s Bank has always been at the forefront of technological transformations of the country’s banking sector. We were the first bank in Sri Lanka to fully computerise and automate banking transactions in the 1980s and have not looked back since, continuing to lead the way in introducing the latest technologies to banking.
In 2015, People’s Bank embarked on a digitalisation journey as a core extension of our founding mandate when the bank was started in 1961, of improving financial inclusivity and economic wellbeing of all Sri Lankans. Our digital strategy entails a holistic transformation: our digital products and services are fully integrated into the core system and we have different products to suit anyone no matter what their station in life is.
As of January 2021, close to a million people have downloaded our mobile banking app People’s Wave, and we have over 1.1 million digital accounts on internet banking People’s Web, over 250 self-banking units, and a digital payments network of over 45,000 merchants accepting credit/debit cards and/or LankaQR payments.
For the first time in Southeast Asia, Africa and the Middle East, People’s Bank launched a comprehensive digital platform under the name People’s Wiz for customer onboarding and loan processing. Since launching in 2017, People’s Wiz has onboarded over a million customers and is implemented at 348 branches.
Further, under People’s Wiz, two digital loans origination systems have already been implemented at 100 branches, one for retail customers and the other for corporates, with plans to extend this to a 100 more in 2021. With this facility, the bank can now process loans real-time, much faster.
Since customer demand is very encouraging for this quick service, we are stepping up efforts to introduce the digital loans originating system in our rural branches as well. On top of all these digital initiatives, we also upgraded our core banking systems, invested in a new credit card platform, and upgraded servers and machinery for faster processing speeds: functions that earlier took seven to eight hours are now completed within two hours. I would like to emphasise again, that our digital journey is about enhancing the technological capabilities of the entire bank so that ultimately it is our customers who benefit from efficient processes and convenient and improved access.
The Board of Directors of People’s Bank fully understood the need to embrace a holistic digital transformation strategy which is why we have invested more than Rs2 billion on a single digital integrated banking system.
Our digital journey is about enhancing the technological capabilities of the entire bank so that ultimately it is our customers who benefit
With that focus in mind, We first introduced Self Banking Units (SBU) to automate banking transactions, then came personal internet banking and mobile banking followed by corporate internet banking and mobile banking called People’s Wyn for both multinationals and SMEs. We also expanded our payment cards offering and digitalised our merchant network and brought in the digital loans originating system. All these culminated in People’s Bank being recognised with several international awards for pioneering the digital transformation of banking in Sri Lanka.
How has the spirit of innovation helped the bank respond to the Covid-related challenges we now face?
What happened with lockdown and curfews was that more customers began to appreciate the importance of digital banking because they finally realised how convenient and empowering it can be.
We had a successful year compared to 2019 despite Covid. The bank’s loan book grew by over Rs400 billion in 2020 and could end the year with higher profits compared to 2019
Earlier, we had to invest in branding campaigns and commit resources to convince people to use the Self Banking Units and then gradually transition to online banking. However, due to Covid-19, we experienced an organic spike in digital adoption with little promotional effort on the part of the bank. The number of daily new downloads of the People’s Wave app exploded to 800-900 and we continue to maintain this even now.
People’s Wave is the most downloaded financial app in Sri Lanka on Google Play Store. Even our corporate cli – ents quickly adopted our comprehensive suite of digital services ranging from online transactions, remittances, fund transfers, payments, payroll, and trade services where the customer could do all their transactions without stepping into the bank. Today, more than 85% of all banking transactions are carried out digitally, so the impact is significant.
If you look at our basic digital channels, Self Banking Units and ATMs, the numbers are very encouraging: In 2019, digital deposits totalled Rs90 billion during the year and Self Banking Units handled transactions worth Rs82.3 billion and ATMs Rs53 billion. Our ATMs handle over 15 million transactions of non-People’s Bank customers on average each year as well. In 2020, the total value of digital transactions exceeded Rs300 billion, a sharp increase from a year earlier.
The number of People’s Wiz accounts doubled to more than 1.1 million while the transaction value grew over 90% to Rs173 billion in 2020. People’s Wave mobile app and People’s Web retail internet banking new registrations increased 50% to 530,209 in 2020, while transactions grew more than 75% in 2020 to 7.3 million and total transaction value increased by 63% to Rs129 billion.
Our corporate offering, including internet banking People’s Wyn mobile app, saw new registrations grow nearly 50% to 5,200 and transaction value ballooned by 900% to Rs129 billion in 2020.
Even during the lockdown, over 80% of our branches remained open and we launched several initiatives to help people have access to cash and struggling busi – nesses to finance their day-to-day operations and salaries.
Further, we gave 400,000 customers loan moratori – ums and extended these to 22,000 SMEs as well. Apart from that, People’s Bank disbursed concessionary loans at 4% interest amounting to Rs13.7 billion. We were able to provide credit to businesses during a very difficult time because we were able to grow our deposit base. Customers trust People’s Bank and our digital offering helped consolidate this trust and win new deposits.
In that context, we had a successful year compared to 2019 despite Covid. The bank’s loan book grew by over Rs400 billion in 2020 and could end the year with higher profits compared to 2019. Notably, our asset base increased to Rs2.2 trillion, and our deposit base increased to Rs1.8 trillion. The bank successfully raised Rs20 billion in debentures as well, demonstrating the level of investor confidence in People’s Bank.