China Merchants Bank
China Merchants Bank is realistic about where it can find its competitive edge.
“We cannot compete with the major top four banks, but we can offer innovation that they can’t,” one senior executive quips.
To drive cutting-edge innovation, the bank’s IT department employs a team of 4,000 people, many of which are constantly developing or co-developing smartphone apps for mobile banking services.
The apps, according to managers, will transform the way China’s private sector deals with banks. In the future, entrepreneurs will no longer stand in line waiting for service; instead everything they need will be done via their smartphones.
To ensure its apps are user friendly, the bank is teaming up with Tencent Holdings to offer other services as well as banking, from health to consumer.
With research and development centres in Shenzhen and Hangzhou, where e-commerce firm Alibaba Holdings is based, China Merchants is tapping into the best software brains the nation has to help it transform itself into a financial technology-focused lender.
Banks can transform themselves in the coming three years through fintech, but changes is here to stay, says the bank, confident that banks as businesses will not become irrelevant in the fintech age. It notes that while no one can see how the financial industry will be transformed, it is clear that banks will no longer only be a platform for savings, investments and remittances. All banks offer basic services, but it is those that offer the most value-added services that will survive and thrive in the fintech age.
Doubtless, banks with the best smartphone apps will be the ones with the best chance to thrive in the future.
The key to success is finding ways to work closely with customers and to offer them services that they need, to be as close to them as possible, China Merchants executives say. Their ultimate job, the transaction bankers say, is to bring the customer as close as possible and to keep them for the long term.