Tech driving new SA banking strategy

2014-04-08 11:32
(Duncan Alfreds, News24)

(Duncan Alfreds, News24)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

Cape Town - The line between financial institutions and retailers is becoming thin as banks go on the charm offensive with technology rewards as a way to appeal to customers.

FNB began offering Apple's iPad as way to grow its customer base, and the bank quickly expanded its product portfolio to include smartphones, laptops and tablets by other manufacturers.

"The benefit for us is that people go from a manual to an electronic world, so the whole system just worked out well. The fact that we outsold any other Apple distributor - that was just a consequence," former FNB CEO Michael Jordaan told News24.

However, competition has increased with Standard Bank following FNB with the launch of an app and recently, an expanded range of technology products.

Standard offers the iPad, Samsung Galaxy Tab, Galaxy S4, among other devices on its banking platform.


Similarly to FNB, the products are offered on 24 month repayment terms at no interest, and it appears that the offer is designed to attract customers - mainly from competitor banks.

SA has around 22.5 million formerly banked adults according to a FinScope South Africa survey and the flat economy means that it is unlikely that there will be a spike in the number of new customers.

The rise of retail banks targeted at lower income earners has also made an impact on the bottom line for major players.

FNB said that competition has had an effect its digital offers.

"There's a lot of competition in the market; there's a lot of players selling smart devices - and I think everybody's feeling it from the exchange rate and that naturally has an effect on the prices in South Africa," said Kim Gibson-Van der Walt, head of dotFNB.

The dotFNB stores is strategy to attract new customers with placement in high traffic areas like shopping malls and where people can play with the latest smartphones and tablets on offer.

However, the banks may not have it all their own way as mobile operator MTN launched the iPhone 5c at R279 per month when the device launched in SA.

Traditional banking

Gibson-Van der Walt said that the purpose of the dotFNB store was to trial new technologies in the finance sector, but also to be of assistance to customers.

"You can come in here and get advice on how to download the app, online banking; cellphone banking. It's not here to replace traditional branches."

Absa recently announced that it was moving to a digital banking platform that will, for example, allow customers to open an account from a tablet.

"Consumers increasingly demand an end-to-end experience and greater consistency when accessing their bank accounts remotely via their mobile, an ATM, their PC or even their iPad," said Arrie Rautenbach, head of Retail Banking at Absa.

Digital banking and technology increasingly blur the line of what is considered a traditional bank and the increased competition between players gives customers more choice in handling their financial affairs.

In particular, the banking by means of an application is seen as one of the primary means for customers to interact with banks.

"It's a model of the future and we see a lot of people moving to banking on an app," said Gibson-Van der Walt.

- Follow Duncan on Twitter
Read more on:    fnb  |  absa  |  standard bank  |  mobile  |  e-commerce

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.
NEXT ON NEWS24X publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.