At the recent ENGAGE ASIA 2023 conference held in Bangkok, Thailand, industry experts highlighted a critical juncture in the nation’s banking sector: the need for greater integration in digitalisation efforts. Despite Thailand’s banks adopting mature financial technologies, a significant challenge remains – the lack of a unified platform, leading to disjointed customer experiences and inefficient operations.
The ENGAGE ASIA 2023 conference revealed that many Thai banks are struggling with independently siloed systems, hindering effective communication and integration. This scenario creates friction in customer engagement and impedes the banks’ overall digital transformation journey. Jouk Pleiter, Founder and CEO of Backbase, emphasized the importance of a strategic approach to digitalization. He noted that many banks are still relying on piecemeal solutions and need to prioritize integrating their various systems to achieve true end-to-end customer engagement. This integration, according to Pleiter, is key to reducing service costs and enhancing efficiency.
The imminent issuance of digital bank licenses by the Bank of Thailand in 2024 is set to intensify competition in the sector. In this context, banking platforms that enable rapid, customer-centric engagement will become increasingly vital. Pleiter suggests that banks at this juncture must navigate between traditional practices and modern strategies to achieve successful digital transformations.
Riddhi Dutta, Regional Vice President, Asia of Backbase, highlighted the potential of a unified, industrialized platform. By leveraging data re-use, repeatable processes, and incorporating AI and machine learning, banks can significantly reduce manual processing and enhance customer engagement. Dutta advocates for a shift from traditional system-centric banking to a more customer-centric model. Research by Backbase and IDC points to a concerning trend among large-scale banks in APAC: a majority have opted to build their digital banking platforms in-house, leading to a 70% failure rate in digital transformations due to the high costs and extended timelines involved.
Backbase offers a solution to this challenge with its Engagement Banking Platform, designed to unify disparate systems into a single, omnichannel platform. This approach allows for rapid modernization and the customization of user interfaces and experiences to meet the unique needs of customers. The platform’s integration of AI and Machine Learning enhances analytics and overall user experience.
The effectiveness of Backbase’s solution is a case study involving a bank with 8.2 million retail customers. Implementing Backbase’s platform led to a 40% increase in transactions and a significant contribution of over 30% to the business’s revenue from retail customers. Additionally, this digital transformation enabled a 30% reduction in operating costs compared to traditional branches, showcasing the tangible benefits of a unified digital banking approach. As Thailand’s banking sector prepares for a new era of digital banking, the insights from ENGAGE ASIA 2023 underline the importance of integrated, customer-focused digital transformation strategies to stay competitive and efficient.
