Maimun Mustafa talks to Sanjoy Datta on understanding the paradigm shift in technologies for tomorrow’s best business practices.
You have worked with Bangladesh for 5 years representing Deloitte. What was the biggest motivation for Deloitte to come to Bangladesh and as such, be a partner of the Bangladesh Fintech Summit?
Deloitte is the world’s largest professional services firm. We are present in the subcontinent and have remained fairly interested in Bangladesh for a very long time. We have worked with many leading organizations, not only in financial services and in areas involving business strategy, innovation, pure operational improvement, customer insights, leadership development, and cultural change. Technology and digital are new words to those who have been in the workforce for some time but not for those who have just entered the workforce. Deloitte works with organizations to leverage both technology and experience, and leverage the combined power for organizational growth.
Under the 4th Industrial Revolution shift there will be mass losses of jobs in some traditional sectors but areas of opportunity in new sources of employment. How do you think traditional financial and non-bank financial institutions can offer new career paths under the evolving Fintech paradigm in this context?
We keep worrying about the job losses but have organizations in developing countries experienced the quantum of losses that have been projected. There is a reason for that. The complexity of transactions, volumes, and types of transactions has increased. As such, we have to provide personalized experiences across to customers so we need to marry the old (brick and mortar businesses) and new (technology-based) companies. This is a transitional phase, where we are trying to understand what customers want, what will they want and cater to these wants.
There are many things that the younger generation bring, chief amongst which is a ‘can-do’ and ‘will-do’ attitude. They embrace technology and leverage it to the maximum to achieve set goals. The older, more experienced generation brings in deep domain knowledge and practical experience and the marriage of the two takes full advantage of the market situation.
What are the new skills we will need in the Age of Fintech?
There are 3 key skills. First, is a deep understanding of customer requirements and experiences, as well as being able to adapt quickly to changing customer tastes and preferences. Second, from an operational perspective, how to gear operations to cater to the first issue of changing customer needs and requirements. Additionally how to remain efficient and how can we bring products to market that customers will want. Finally, all companies work in a regulatory framework so we must ask ourselves how we can conform to changing regulatory frameworks and still remain competitive. Youths can focus on these areas because these are issues that will remain relevant for some time.
You have worked with globally renowned banks like Standard Chartered and Deutsche Bank. Do you think that Fintech firms challenge, compliment or work under traditional banking in the age of continuous change?
For fintechs and traditional financial institutes to co-exist, an environment can be built where both grow and thrive. A fintech has no legacy or baggage but it also has very little customers or infrastructure. So they require substantial capital, experience, customers to build a scalable, sustainable business model and also require to stay relevant before another fintech comes along and provides a better solution. The operating model of traditional institutions is similarly not geared for this rapid pace of change in customer requirements and increasing competition in a crowded marketplace. Collaboration/partnership/alliance between traditional financial services companies and fintechs would enable financial institutions to continue to grow together with their partner fintechs and serve their customers effectively.
How do banks, fintechs and other companies thrive in an environment where all service providers are vying for that 10 Taka BDT?
There is no one answer to that problem. However, I will go back to keeping it simple. Electronic coupons and payment systems where cash is not required but instead use the mobile phone to effect payments. Using marketing budgets (in coupons) for targeted sales is another great option. However, the real question is, can we shorten the time between impulse (decision) and gratification (making customers happy)? Incentives for digital payments and disincentives for cash can lower inventory and optimize the supply chain (through e-commerce).
How can we accelerate online or digital transactions as opposed to cash or ‘under the mattress’ transactions?
People keep cash under the mattress, not because of security, but (according to them) this is their most secure way of keeping their money. There is usually no alternative to keeping money securely as also having easy access when one requires it. Solve the problem of not paying in cash by a formal mechanism (a digital wallet or a bank account), and ensure that this process is acceptable to all members of the eco-system. For example, why can’t people who do not have access to banks in their neighborhood deposit cash at a pre-designated shop and get a receipt instantly from the bank, say on their phone?
What technologies are feasible as ‘here-and-now’ ones for Bangladesh?
The great thing about Bangladesh is its telecommunications connectivity. What never ceases to amaze me is that whenever I arrive in your country everyone’s phone starts ringing and everyone is talking. Even the Immigration officer asks me for my Bangladesh mobile number? Imagine if that is the prevalence of connectivity and smartphones are becoming readily available, barriers to the adaptability of new technologies are also lessening with a greater proportion of the population willing to adopt new technologies/apps to simplify their lives. If we focus on reducing the cost of ownership, i.e. increase affordability combined with ease of use of operations I do not think you require a technological revolution to sort out any problems for the country going forward. People adapt well if we keep things simple. Nevertheless, if I were to be specific for technology, cybersecurity should be a top priority at the moment.