BSN awakening to a new dawn

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BSN is embracing a 1Malaysia approach to consumers and businesses (photo credit: Wikimedia Commons)BSN is embracing a 1Malaysia approach to consumers and businesses (photo credit: Wikimedia Commons)

Bank Simpanan Nasional (BSN) has long been seen as conservative and laidback. But that is changing. In 2010, the bank decided change was due to remain relevant to the market and mapped up a five-year transformation plan.

This year marks the plan’s final lap. Business Circle managed to catch up with Alain Boey, BSN Senior Vice President and Head of Transformation Management Department, on the progress of the transformation.

According to Boey, BSN is in the process of changing its entire core banking system and is scheduled to switch over to the new system by yearend. “It’s the biggest system in the bank. The other satellite systems are mostly in place,” he shares.

For example, its customer experience transformation involved the revamping the entire process – IT systems, standard operating procedures (SOP) etc – while the enterprise content management system transformation revamped how the bank manages its documents.

Boey says that BSN had been very conservative and had adopted the wait-and-see approach when it comes to new technologies, preferring to err on the side of caution. “We’re always late! We were the last to have internet banking, in November 2010, and now we’re in the process of launching our mobile banking (looking at Q3) – probably the last in the market to do so.”

No longer averse to new technologies, it is now taking them on with gusto. It was the first bank in this part of the world to roll out agent banking – the only other country in Asia that has done this was India – and the first in the world to introduce the virtual teller machine.

BSN’s agent banking or Ejen Bank Berdaftar BSN (EBB) initiative won the 2013 Malaysia GreenTech Award under the Green Tech Financial Institution Award category. Other awards the bank has won included the Best In-house Outbound Contact Centre in Malaysia (over 100 seats) at the 2013 CRM & Contact Centre Industry Awards for its transformed Customer Service Call Centre.

“We’ve always been very shy when it comes to all these awards but we decided to go all out and came out tops… We may be the last to go in [to adopt new things], but will make sure we go in with a bang!” says Boey.

It is also changing its communications – to be bolder, more youthful and exciting, and is gearing up for a major rebranding this year.

“This is where the transformation in BSN is going. We want to be out in the market, we want to be seen!” exclaims Boey.

A 1Malaysia approach

In recent marketing communications, BSN has changed its focus from being Malay-centric to 1Malaysia. Its customers are still predominantly Malay but that is slowly changing to be more balanced. The target market is also shifted more towards the younger executives, says Boey.

“We’ve always wanted to capture from cradle-to-grave. But we lose a lot of our customers when they start working. BSN is not an employers’ bank because we don’t have current accounts or checking facilities… Now that checking is going to be more challenging, it is working towards our benefit,” he adds.

BSN has 8.6 million active customers. “In terms of microfinancing, we’re the no.1 in the market; we’ve overtaken Maybank, Bank Rakyat… This year, we’re slowly going into the SME market,” Boey shares.

Agent banking

BSN has empowered small retailers, and even individuals with businesses to act as agents for the bank, or Ejen Bank Berdaftar BSN (EBB). These agents are given simple handheld point-of-sale (POS) terminals through which they will be able to perform banking transactions. A customer can go to any EBB to make withdrawals, deposits, purchase certificates, pay utility bills and even prepaid mobile top-ups. Late last year, it further empowered the EBBs to sign up new customers as well.

“Today we have 5,200 agents across Malaysia. They are present in every mukim. Any mukim you go to, you’ll find either a BSN branch of a BSN agent. This is where we are today. Hopefully, with all these things in place, it gives the rakyat more convenience in performing their banking transaction,” he says.

Residents of remote places who previously had to commute for hours over quite a distance to get to a bank branch can now just go to a nearby agent, saving them travelling cost and time.

As BSN belongs to the Ministry of Finance, it is mandated to provide financial inclusion to everyone, hence the reason why it goes to places no other banks will. It has numerous social branches for that purpose. With EBB, BSN will be able to save on investment into the social branches, shares Boey.

“In budget 2012, our Prime Minister in his speech mentioned that BSN will have 5,000 agents within three years. We achieved that in 1.5 years. That shows how the public perceive the importance of these agents and that the non-agents have seen the benefits of EBB and want to be part of the network,” says Boey.

According to Boey, the agents have seen their own businesses grow by at least 30% since they signed up as an EBB – “that’s on top of earning a reputable commission from the bank. For example, when customers go into a sundry shop to do a banking transaction, they may inadvertently buy something too.”

Boey assures that the EBBs are people the community knows and trust or have business with. “There’s a vigorous selection process and screening,” he says.

BSN intends to increase the number of EBBs. “There’s no maximum number. The whole model is to have as many of these agents as possible. We already have 5,200. We envisage this number to grow. What we want is to have an agent in every corner. It reduces the need for a physical branch or ATMs. We’re also introducing new functions for the EBBs,” he shares.

Meanwhile, the devise the EBBs use is also being used in BSN’s promotions and roadshows. “With these devices, the turnaround time to perform a transaction has been reduced; for example, the time taken to open a new account, previously 9 minutes, can now be completed in 3.5 minutes.”

Virtual teller

In end-December, BSN introduced the virtual teller machine, which is slightly more advanced than the ATM where one can open an account, submit loan documents, get replace cards etc. The machine connects the user with a human agent, who could be seated anywhere, via video conferencing. “If you walk into a branch, you’ll take a number as usual and wait. If the branch is very busy, you’ll probably be served by another teller seated somewhere else – probably at another branch that is not so busy. This initiative is to improve the customers’ experience so that they don’t have to wait so long,” explains Boey.

The pilot project involved 11 sites, a machine at each site. “Eventually, we’ll roll out more… BSN is the first in the world where you can be served by any agents anywhere… Getting the consumers to use the machines will need a fair bit of education though,” says Boey.

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