ALAT leverages technology to prepare Nigerians for future banking
by Anthony Osae-Brown and Jumoke Akiyode
May 25, 2017 | 12:55 am| | | Start Conversation
Dele Adeyinka is the Chief Digital Officer of ALAT, Nigeria’s first fully digital banking platform and a subsidiary of Wema Bank. In this interview with Anthony Osae-Brown, Editor BusinessDay and Jumoke Akiyode, Adeyinka talks about the need for digital disruption in the banking sector, as well as the unique offerings of Alat. Excerpts
What is ALAT?
ALAT is the digital arm of Wema Bank and our primary focus will be on some segment after thorough analysis, we decided to focus on the youth, young professionals and the young entrepreneurs. We want to be able to serve them from wherever they are. Wema Bank has been in banking for 72 years, so with the benefit of hindsight having been in the industry for so long and of course with the foresight of positioning ourselves and with the view of making this legacy called Wema bank, outlive us, we decided to strategically position ourselves as the first fully digital bank in Africa not just in Nigeria. Two years ago, almost every bank in the industry claims to do retail banking, except a few that do corporate banking without branches.
But there is no way we will play effectively in the retail space if we don’t leverage technology and there are a thousand and one examples that we can give to corroborate that. Telecommunications operators today are in the retail space. The last operator to get into this race has about 35 million customers just because they leverage technology. So, you can imagine the numbers of the first three operators. Similar to that is banking. We serve the consumers and for us to say we want to do retail the way retail should be done, we need to leverage heavily on technology and that is why as a bank, we are positioning ourselves to be a bank of the future, so we are using technology to drive our business and serve our customers.
Digital bank is different from a digital product, prior to now we had, and we still have a whole lot of digital offerings for our customers. It complements our physical structures, so we have branches in strategic locations all over the country and then we have digital products to support serving these customers, so they can initiate some transactions on the digital end and complement it with the physical structures. But with the digital bank the way we structured it, these customers will not need to walk into any of our branches. As a matter of fact, from the point at which you are opening an ALAT account, customers would not be attached to any branch because transactions are purely digital. We are reaching out to customers from where we want to serve them, that is; social media, (Facebook, Twitter, Instagram), different websites and platforms. So we are going to advertise heavily on the digital sphere. We onboard them, and all they need to do is go to any of the mobile application stores (Apple store for iPhone users and Google play store for Android users) and download the app. After installing the ALAT app, with just a few clicks, an account can be opened in less than five minutes. An ALAT account is an account that can be verified across all the channels so customers can be empowered with this account right from wherever they are able to download the app to start doing transactions immediately.
What is required for customers to open an ALAT account?
All that is required from a customer is to have a valid Bank Verification Number (BVN) which is the universal identifier. Once you have your BVN, give us your phone number, email address and with that, you have a valid account.
How would customers be able to fund their ALAT account?
There are several options available on the app today and we will keep adding more options. This app was built by Nigerians, so it is proudly a Nigerian product for the world. To fund the account, we have given three options. For a customer that is already on boarded, you can fund it through a card issued by any bank in this country and you will be able to credit your account by adding the card. For example, if you are an existing Wema Bank customer, you can transfer funds from your Wema bank account to your ALAT account easily, you can also fund from another bank card by choosing the option, putting in the card details including the card expiry date and CVV then put in your chosen amount and your ALAT pin and your account will be credited. You can also add a foreign card, issued by any bank in the world. You can do funds transfer from an existing internet banking option into your ALAT account, which is not yet available but will be given very soon. In extreme cases, which we don’t want to encourage, if you have physical cash, you can walk into any of our physical branches and deposit into your ALAT account. Those are the various options available to fund your account.
How are you going to make sure that people do not have challenges with downloading and using the app, especially with regard to regular updates and security?
This is not the first app we are building. If you go on the app store and search for Wema mobile, you will see our digital products which we are still offering to our retail customers to give them access to their bank accounts, so this experiment is second in the row. We have done Wema mobile and our customers are still using it. However, this particular model is technically different from a regular digital product. It is a bank in itself and we have partnered with the best in class third parties to bring this to fore. As we were building the app, we engaged some third parties in the country who are specialists in the security area, to continually test our logic, stress testing, regression analysis on the app itself and a whole lot of penetration security test on the app to ensure that is world class. All the methodologies used are not just ordinary.
Are you collaborating with telecommunications service operators?
It is public knowledge that we are partnering with Etisalat to do a whole lot. We will continue to partner with as many telcos as they give us the opportunity to because it has to do with reaching out to the youth and young entrepreneurs, so we are open to more and more partnerships. We have had that in the past, relating with the bank, and on Alat, we would also have many more partners to allow us scale up at the level at which we want to scale and reach those numbers that we really desire to reach out to.
Was the problem of low broadband penetration in the country considered before establishing a fully digital bank?
We know that there is low internet penetration and data is an issue but at the same time, if you’re going to look at the challenges alone, you might not do anything. I can tell you that there are a thousand and one challenges in Nigeria today, such as power, but would you say that because we don’t have adequate power supply, you will not do your business? We will still want to survive despite all those challenges. Nigerians are very resilient and creative so we will find a way around those challenges. That is the same spirit in banking, apart from banking; every industry is being disrupted right now. You will allude to the fact that transportation is being disrupted, gone are those days when you have to look for a taxi. Now, all you have to do is go to the app on your phone, enter your destination, select mode of payment and a taxi will be waiting for you outside. We are here in Lagos; people are studying from here and are getting authentic university and professional certificates from institutions abroad. The education system is being disrupted. E-commerce has taken over and whether we like it or not, banking will be disrupted, so what we have done in Wema bank is that we are disrupting ourselves in business and then we are disrupting the industry because we are challenging a whole lot of statuesque as it were in the industry today and gratefully, the regulators are giving us all their support with this new area because we are not flouting their rules. BVN is mandatory in this country and we have made that mandatory on the app as well. We do KYC in 24 hours, after submitting your documents to us, we verify who you are, and then your account status changes from being inactive to being active, so we are adhering to regulations, the only thing we have done is to digitize everything rather than having customers coming to the banking hall, filling long forms and queuing up. We are selling simplicity, convenience and reliability to our customers.
What are ALAT’s future plans?
Our plan is to have at least 3 million customers on board by the year 2020. That is the corporate plan, but from ALAT, I know we would surpass that number.
What is the relationship between the Wema physical bank and the ALAT digital bank?
Wema bank is the parent bank for ALAT. All the accounts we are opening is still for the parent bank because we don’t have a license to run on our own, that is why you would always see ‘ALAT by Wema’. We are riding on the license of Wema bank to do whatever we are doing. The difference is that we are digitizing all the offerings. Our customers who still want to walk into our physical branches will still be able to, but from a fact, we know that majority of the youths who would naturally not want to walk into a branch. As conducive as we are making our branches look, the young professionals don’t want to sit in the bank and start filling forms, they would rather go on their mobile phone and do whatever they need to do when they are on the move. Those are the people we are targeting.
Would you also say that ALAT is targeting the unbanked population in a way? If so, what kinds of sensitization and education have you given the public on this?
For this first phase, because we know that you need a BVN to come on board, it means you have to have had an account somewhere, but the process of having BVN would be easier because we are partnering with National Central Switch to demystify that process. So it would not be compulsory for you to walk into a bank to register for your BVN. With what we are doing, you can simply get to the nearest supermarket, put in your thumb print, capture your face and it’s as easy as that. So we are bringing the unbanked into the system by simplifying the process. Once we simplify the process and we are not restricting people to go into the physical bank, people will do it, and we would see multi millions coming into the financial sector.
Apart from it being easy and convenient to carry out financial transactions on the go through ALAT, what are the other incentives to open the account?
On ALAT, your card will be issued free of charge and delivered to you for free. We are taking banking to the public and empowering them to do those transactions on the app. When you need to activate the card, you don’t need to go to an automated teller machine of the card issuer; you can change your pin and activate the card on the app. We are the first to offer that in this industry.
With an ALAT account, you don’t need to call the bank when you are travelling out the country to ensure that your card works in the country you are going to, you can choose whichever geography you want your card to work on the ALAT app by clicking the country you want enabled and the country you want to disable, because we have heard instances of people sitting here in Lagos, and their card is being used in some foreign country and they are being defrauded. With card control, we have taken that out, so people’s transactions are more secure. You can also choose which channel you want the card to work, either POS, ATM, web portals or all and save. If your card is stolen you can go to www.alat.ng to disable the card immediately. Excitingly, we offer 10 percent interest on money in your account, which is the highest interest rate in the industry today. A normal savings account gives about 3-4 percent interest. Most people don’t even know how much they earn on their savings accounts today, so we are waking everybody up to say they should earn a lot more on the money they work so hard to make.
by Anthony Osae-Brown and Jumoke Akiyode
May 25, 2017 | 12:55 am12893 | 93 | 0 | Start Conversation
Big Read |