Bank's Green Leap with Digital Automation

Dimantha Seneviratne, an experienced CEO in global finance, skilled in banking, risk management, and project management. Holds an MBA, Fellowship of Institute of Bankers, and leadership training from Harvard. Proven results as Chief Risk Officer with HSBC and CEO of two Sri Lankan banks. Currently leading NDB Group.

In a conversation with Prisila,a correspondent in Asia Business Outlook Magazine, Dimantha discussed the bank's digitization and automation efforts, high- lighting the rationale behind investing in sustainable, smart technology. He emphasized strategic alignment and outlined future plans for the bank's digital transformation journey.

Can you provide an overview of the digitization and process automation initiatives currently in place at the bank?

Digitization and automations at are far-reaching and impactful. It encompasses a wider scope than a mere app solution to customers and can be classified in to four broader segments, viz., Transforming the customer experience, Transforming the way we work, Transforming our decision-making and Transforming our partnerships and collaborations. These have been translated to more tangible solutions via customer-facing digital propositions, enhancements to customer experience through providing access to secure, seamless and user-friendly platforms, RPA infrastructure, automation of repetitive and mundane tasks through work flow solutions, data analytics and data-driven performance monitoring and decision-making across the organization.

If I may briefly mention the specific initiatives or solutions we have rolled out, in terms of the customer experience, we have one of the most popular and high-traction mobile app solutions dubbed NDB NEOS, to retail clients as SMEs. SME app NEOSBIZ is the only mobile app for SMEs in Sri Lanka. NDB NEOS App has led some ground-breaking industry first initiatives such as End-to-end digital onboarding (from application, document submission, VKYC to approval) for retail/personal loans through Digi Loans, integration of the NEOS platform with NDB Securities Pvt Ltd (one of our Group companies), which enables customers to engage in equity trading through the app and virtual account opening. Additionally, the App enables the generation of CRIB reports and scores (CRIB – Credit Information Bureau of Sri Lanka – reports and scores which indicate creditworthiness of debt applicants), placing Fixed Deposits and virtual account opening through VKYC (virtual KYC) eliminating the need to visit a branch physically.

In terms of enabling our own employees with better digitized solutions we have established an IT Service Management Division to provide an improved service to internal users, launched a System Support Register (SSR) and provided a platform for internal users to direct all application support issues and Systemization of daily IT operations, providing increased transparency and accountability.

We have also transformed the way we work. NDB’s ongoing automation of repetitive processes has continued to increase operational efficiency and generate cost savings. Over the years, the Bank also strengthened its automation capabilities to design tailor-made workflow solutions based on the requirements of users.  We have automated over 200 processed using workflow or RPA solutions. Remote working and Work from Home arrangements facilitated for nearly 40% of the team has also enhanced our agility and flexibility in the workforce.

In terms of Transforming our Decision-making - In line with the aspirations of the Bank’s strategy, we have made inroads in leveraging data to drive better decision-making in recent years. This strategic thrust has also entailed nurturing a data driven culture across the organisation, by strengthening capabilities within the data team and embedding data insights into daily operations and decisions. Key areas of focus included obtaining customer behaviors insights through deep dive analysis into customer behavioural patterns which enable customer profiling and targeted marketing. Utilisation of data models with predictive capabilities providing rich insights into future customer behavior has also been a major win. Cross sell opportunities are fortified through the use of performance dashboards across all areas of the organisation. Data analytics and visualization through power BI platforms with insights shared across regions, branches and business lines have also added significant insights and more informed decision making.

In terms of Transforming Partnerships and collaborations, NDB has sought to effectively deploy technology to build and transform relationships across its ecosystem, supporting the drive towards cashless by linking customers, merchants and service providers. Key initiatives include increased biller integration through NEOS with new merchants added to the system and becoming the first bank to partner with Trade Lens, a blockchain platforms which facilitates the provision of digital trade finance solutions to customers.

What prompted the Bank's investment in smarter, greener digitization, and how is alignment with strategic goals ensured?

NDB has pursued a market-leading digital transformation journey over the past seven years, aligned to the aspirations of the Bank’s respective mid-term strategies. Our digital strategy has centered on elevating technology from an enabling role to a transformational one, thereby rewiring all aspects of our operations to sharpen our competitive edge, improve profitability and create better stakeholder interaction. The Bank’s aspirations towards being digitally empowered and smart, the necessity in adopting digital technology to remain competitive in the ever-evolving and intensely competitive market place, harness benefits from productivity enhancements and cost efficiencies offered by digitization and NDB’s strong commitment to greening our processes are the key attributes that I would say drive our digitization.

The alignment of our digitization blue-print to the overall strategy is ensured via multiple means. Digital as a pillar is a critical component in our overall strategy. There is oversight from the Board of Directors level, with a Director appointed to the Board who is a veteran in the field of IT and digitization, who provides much guidance on our digital journey. We also have a dedicated Board Sub Committee for Digital Transformation chaired by the said Board Member and the committee structurally reviews the progress made by the Bank in digitization.

Furthermore, we have re-aligned our organization structure such that digital financial services is no longer a separate unit, but one which seamlessly blends with all business lines and advises all business lines may it be retail, wholesale banking, SMEs of project financing, in embedding digital solutions at all new and existing products.  

KPIs linked to digitization driven results are assigned to respective staff members starting from top management thereby closely aligning performance to targets set.

"We have strong market and business intelligence which track emerging customer needs particularly from Gen Z as they represent the future of our customer portfolio"

What considerations are made to ensure that the digitization initiatives contribute to environmental sustainability and a "greener" impact?

Preserving the environment and greening our processes have been two imperatives that we have been strategically pursuing over the years, via various functions such as responsible lending, corporate sustainability and digitization. Through our digitization initiatives we have been able to channel thousands of transactions away from a conventional branch counter to virtual modes. The most significant savings that this has earned are reduction in paper usage and emissions created through customer travelling. Our paper consumption has considerably reduced over the years, stemming both from virtual transactions of clients and internal automated processes which eliminates dependency on paper. In 2023 our YOY paper consumption has reduced by 18%. Lesser commuting by clients, even our own staff under the work from home setup has definitely cut down  a lot of emissions thereby reducing our carbon foot print. In 2022 our carbon foot print reduced by 5% compared to 2021. As numbers are still being finalized we expect similar trend in 2023 as well.

How do you balance the need for digitization with concerns about job displacement and the impact on the workforce?

In fact digitization has been all but a boon to us. Given the economic crisis that Sri Lanka experienced during 2022-2023 period the country saw an exodus of skilled labour migrating to elsewhere in the world. This was particularly high in the banking sector, and the trend was similar at NDB. When attrition rose, we did not resort to replacing staff one on one. The enhanced capabilities of automations and digitizations have already paved us the way in working with more rationalised head count.

Before the crisis, when attrition was low, staff that were freed up from mundane and repetitive tasks were deployed in more value enhancing job roles, mostly in client servicing, which derived us the dual benefits of better quality customer service, and more enriching and better exposure job roles for our staff. As such thus far automations and digitization have never caused job displacements or collided with employee interest.

Looking ahead, what are the next steps or future plans for the bank's digitization and process automation journey?

It most certainly is a journey and not a destination. And a journey on which we want to continually improve on. We will continue to automate more processes with the ultimate objectives of leaner processes, cost efficiencies and speedier turnaround time to the customer. We have qualified teams dedicated towards this end under the direct supervision of top management. Our digitized solutions to customers will also continue, and as I mentioned earlier, possibility of digitization will be considered at every step of the way in product development across all business segments, such that prospects of digitization is never in a silo.

We have strong market and business intelligence which track emerging customer needs particularly from Gen Z as they represent the future of our customer portfolio. We integrate all these demographic trends and opportunities in emerging technologies in devising our digital solutions.

We have additional initiatives lined up on which we can share more information as they take more solid shape.

All in all, the key component of our strategy is customer-centric digitization and that will permeate to all that we do internally and in catering to our customers.