Despite competition, there is no need for banks to treat startups as an enemy. Let DBS Indonesia Head of Digibank Leonardo Koesmanto show you how the company does it

As confirmed by several reports from various institutions, customers of banking and financial services are changing these days.

Thanks to increasing number of internet and smartphone penetration, and the rise of on-demand services in various cities in Indonesia, customers have begun to have different expectation for their banking and financial services.

In addition to expecting security and reliability, they would also expect simplicity, speed, and effortlessness.

“Whether we know it or not, the digital revolution has put banks under siege. With Internet 2.0 and mobility, the game has been redefined,” DBS Indonesia Head of Digibank Leonardo Koesmanto told e27.

To embrace this change, in August, DBS Indonesia launched new features that aim to fulfill the needs of customers in the digital era. The features include the use of biometric technology (to assist customers in Greater Jakarta Area to open accounts through the help of agents), AI-driven Virtual Assistant (to assist with customer service), an intelligent financial planning and monitoring feature, and enhanced security through the use of soft token security.

But launching new services does not seem to be the only thing that banks should do when it comes to embracing the digital era.

Koesmanto, who had recently spoken at the Global Mobile Internet Conference (GMIC) Indonesia 2017 in Serpong, pointed out the fact that banks have been facing serious competitions with non-banks in providing a financial service that can truly match customers’ needs and preferences.

“Whether it’s Google, Apple, Facebook, or closer to home, Tencent or Alibaba, non-bank players are making incursions into our industry. The biggest payment company in the region today is not a bank; it’s Alipay,” he explained.

“Nine months after entering the asset management business, Alibaba became the world’s fourth largest money market fund, with more than US$80 billion in holdings and more than 80 million customers, all from a standing start,” he added.

Also Read: Singapore DBS/POSB bank launches video teller machines in 9 locations

Seeing that, it is natural for banks to consider startups as their main competition nowadays. But instead of competing with startups, DBS Indonesia sides with the belief that collaboration can actually benefits both sides.

“The rise of fintech companies has reshaping the future of financial services. More than that, it is driving more collaborative and progressive behavior between financial industry and newly rise fintech companies,” Koesmanto said.

“These new companies are playing a major role in bringing transaction banking to a new age. The financial services industry should therefore embrace fintech and the broader trend towards digital banking,” he stressed.

In Singapore, the bank plays sponsors several leading accelerator programmes including the Startupbootcamp, which offers innovative start-ups support to develop their businesses, access industry expertise and pitch to the growing FinTech investor community in Singapore.

It also engages with the fintech ecosystem by running programmes such as the DBS HotSpot, which it describes as the first pre-accelerator programme created and wholly-run by an Asian bank. The programme had accelerated over 40 startups, and it will now be housed at DAX.

The bank has also run a number of hackathon events, as well as supporting and nurturing over 100 social entreprises through DBS Foundation.

Also Read: Neal Cross of DBS: Once you are able to sell yourself, you can sell anything

It generally aims to foster collaboration between its own employees from around the region, startups, and the fintech community.

“This includes embarking on a comprehensive and holistic mission to changing the culture and mindset of staff, re-architecting the bank’s technology infrastructure, and leveraging Big Data, biometrics and artificial intelligence to reimagine banking,” Koesmanto said.

In Indonesia, the bank is currently working with a financial service comparison site to help them with customer acquisition, and a logistic startup to ensure better customer on-boarding and debit card delivery experience.

It also partners with a US-based startup to provide Artificial Intelligence capability for digibank’s Virtual Assistant, and is looking forward to work with more local fintech startups.

“In Indonesia, we also commit to embrace collaboration with fintech in delivering banking services that enable customers in accessing financial services in a disruptive way,” he closed.

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Image Credit: DBS Indonesia

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