Emirates NBD to create digital-only bank to target young customers

Going digital has been a win-win situation for banks globally. Satish Kumar / The National

Emirates NBD, Dubai’s biggest bank by assets, said it would invest Dh500 million in the next three years to boost its digital capabilities.

The bank is planning to create a separate digital-only bank aimed at young customers at a time when physical branches are losing their appeal with Millennials.

“We are making a commitment to the future with our digital transformation plan,” said Shayne Nelson, the bank’s chief executive.

“Our focus on technology innovation and adoption to create digital-only products is creating a new paradigm in the way people bank in the UAE. This significant investment will drive further innovation and solidify Emirates NBD’s reputation as an innovation-led, customer-foc­used bank that is indisputably a market leader in the region.”

The bank, which has been a first mover on the digital front in the UAE, will spend the Dh500m on rolling out more of its products and services online as well beefing up its online sec­urity and anti-fraud systems. The money will also be spent on making its online services more user-friendly and quicker, it said.

Going digital has been a win-win situation for banks globally. Customers benefit from convenience and speed, while banks save money. About 800 million customers globally use mobile banking, and that is expected to more than double to 1.8 billion users by 2019, according to the auditing firm KPMG.

The UAE, with a young and afflu­ent population, is at the forefront of the digitisation drive. With a population of 9.2 million, it has the highest usage of smartphones in the world, with penetration rates at about 70 per cent, according to a recent Google study.

And even though cash has been traditionally prized over cards in this part of the world, many traders and consumers are increasingly being won over by the ease of cards and digital payments.

Banks have not missed the opportunities. The UAE Banks Federation launched last year its mobile wallet project after receiving the green light from the Central Bank. The initiative, announced in February 2015 as part of the country’s push to go digital, will allow bank customers to make payments with their mobile phones in a number of ways, including through SMS and phone-swiping technologies.

Emirates NBD said last year that it expects about 90 per cent of customer transactions to be done outside branches in the next three years. While ATMs, phone banking and digital applications in recent years have pushed that figure to about 80 per cent, online mobile banking is expected to boom, it said.

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