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Transaction banking reaps digital dividend

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Transaction banking has always relied on technology and digital solutions to provide value to clients. Today it is all about transforming client experience through the use of automated services and solution providers for niche services, explains Isaac Thomas, head of transaction banking at Abu Dhabi Commercial Bank.

Isaac160x186 Isaac Thomas, head of transaction banking at Abu Dhabi Commercial Bank

Transaction banking has been one of the key successes in the wholesale banking business over the years. This has led to more transactional flows, more clients, more volumes and more investment in technologies.  In 2017, we embarked on a bank-wide digital transformation initiative, adopting digitization as one of our key strategic pillars in order to continue to simplify the client experience and improve the digital ecosystems for all our customers. A detailed digital strategic plan was prepared to guide implementation, with the objective of increasing the use of the cutting-edge technology that creates value for our customers. We also wanted to harness digital for growth and efficiency across the bank by enhancing our systems and making greater use of data analytics. 

Specifically, we focused on the following areas – moving transactions onto automated channels, process re-engineering and automation, development of new ‘digital’ products, and overlaying it all with a superior customer service proposition. Today, over 90% of our transactions are on automated channels – end-to-end processes for payments, trade and reconciliations have been implemented with clients across all our segments. There has been greater focus on operational business that uses technology to process more at less cost. 

But recently, macroeconomic factors across the region have had an impact, especially in the trade business, where we are seeing a lower level of deals being completed. This has encouraged us to redouble our efforts to maximize our share of the market and look at how we can compete for the deals that make sense for us. 

In addition to relying on digitization, in these tough conditions client-facing skills like relationship management and excellent customer service have become even more important. We regularly survey our clients and these surveys identify that a bank’s coverage and engagement model are more important than ever because relationship managers continue to be the primary contact. Superior customer service through proactive human interaction cannot be underestimated in servicing client queries. This is a key factor in determining a client’s repeat business with us. 

One of the other notable trends of digitization within the transaction banking sector has been the extent to which clients are looking to their bank for strategic advice now that their transactional business is automated. More and more client interactions are about new business opportunities and other strategic discussions. This is a positive sign and is a testament to our transaction banking capabilities. 

Going forward, we expect transaction banking business to be perceived as a collection of banking services that can be ‘cherry picked’ by the clients based on their specific needs, in the same way that they are doing with the likes of Google, Facebook, Amazon etc. Abu Dhabi Commercial Bank is well positioned in this regard, given our focus on both sustainable superior customer experience and continued investment in new technologies and greater collaborations with solution providers and client eco-systems.