Andrіі Kostenko, Head of business development department at RENOME SMART, attended Ukrainian CASH FORUM, where he shared his experience on implementing effective solutions for establishing self-service channels for banks. He talked about smart departments, what they consist of, what tasks they perform, as well as about implemented projects in Ukraine and abroad.
RENOME SMART is an IT product company that has been working in the field of fintech solutions since 1991 and is the official representative of two global equipment manufacturers Diebold Nixdorf (Wincor ATMs account for 70% of the Ukrainian market), Giesecke & Devrient (manufacturer of sorting equipment, like the one used in the NBU). Among the key clients in Ukraine — banks, financial institutions, retail, and local government agencies.
Our company is not directly related to cash. However, we automate processes and help our clients work with them more efficiently.
According to a study by PricewaterhouseCoopers, the financial world is moving into the digital dimension. Banks (and not only) reduce support costs and transfer their own financial products to digital, etc. However, the study emphasizes that the importance of keeping direct contact with the client should not be forgotten. I recently read an article about Spanish farmers who protested over the transfer of bank support to online mode.
The hybrid format of cooperation can satisfy all clients of financial institutions — both those who know and can use digital products, and those who are used to going to branches. At RENOME SMART, we help banks create a self-service area without reference to its location, in places where customers are concentrated. These can be shopping centers, markets, or business centers. From my experience, consumers (individuals and business clients) in this sector are usually interested in working with cash and the possibility of performing non-cash transactions.
Smart branches transfer most of the client’s basic needs to the self-service area: adding funds to a card or deposit, paying off a loan, withdrawing cash from an ATM (especially popular now), etc. Among our cases, there is also a currency exchange option and the possibility of depositing revenue for small and medium-sized businesses.
There are also more complex self-service areas that provide for the onboarding procedure. It’s when the client does not need to go to a bank branch to open an account or reissue the card. One of these projects was implemented in Ukraine and statistics show that if all processes are properly configured and such a self-service area is set up, the bank’s income increases by 30%.
The best solution today is to combine direct and digital interaction with the client. The advantages for all parties are obvious: customer loyalty, since there is no need to contact a bank branch for a simple operation, stand in line for a long time, the ability to use banking services at a convenient time and place; integration of digital solutions with physical sales channels; increasing the efficiency of employees of financial institutions and reducing the burden on branches.
At ProCredit Bank, we worked on creating branches where there are practically no cash registers. One can use them to perform all non-cash and cash transactions. This is one of the first banks to launch a new product — parcel locker, which supports card issuance operations. The client can order a card in the app or at a branch and receive it via the post office.
In 2017, we had our first global player in Angola. Currently, our solutions are used by 4 local banks, including some of the largest — Atlantico and BAI.
Imagine our surprise during our first visit to our partners, when we saw queues at banks at 6 am. It turned out that the deposit service is very popular there due to the fact that people are afraid to keep money at home, so everyone prefers the bank option.
Thanks to our self-service solutions, banks have transferred the number of customers from regular branches to self-service areas. The first smart branch, launched in May this year in Angola, consists of an ATM and a safe deposit box. In addition, it operates independently thanks to solar panels and video surveillance. The next step is to install a device for printing and issuing cards in 2023.
We started another interesting project at the end of last year with KorpOn from Azerbaijan. We are grateful that despite the difficult conditions and the war, they believed in us. It is worth saying that we have been cooperating for a long time. However, previously the cooperation model assumed that the end customer of smart branches was the Bank. KorpOn went the other way, creating its own financial ecosystem, which provides for the installation of safe deposit boxes in the locations of potential customers. The device allows you to accept any cash payments. The only limit can only be the number of banknotes exceeding 30,000 bills — this is the capacity of one device. According to the idea of the project, banks do not need to buy their own equipment or invest in it — everything is provided by KorpOn, in return it receives a commission from each transaction. Currently, six banks are connected to the network. This means that their customers can perform operations to top up their account, repay a loan, and so on in one of these devices (and there are already 70 of them in Baku). We have fully provided the software part of the project, and an integration gateway has been set up with each bank. Therefore, after the client is authorized (entered personal username and password), we can see who is depositing the amount to the account and what amount. By the way, funds are credited instantly.
KorpOn plans to move outside of Baku. Currently, services for adding funds to current accounts, card loans, and making revenue for small and medium-sized business customers are available. Why are businesses so interested in these devices? The answer is, the speed of accepting bills and the higher amounts of cash in average receipts. Once, when a customer deposited 150 thousand manat (approximately 50 thousand dollars), and the device accepted them without stopping in 7 minutes.
Cooperation usually begins with an audit of banking processes. We delve deeply into the processes, analyze them, and identify those that would be appropriate to transfer to the self-service area. The next step is to develop a strategy and coordinate it with the bank. It describes all the simple processes that take up time for bank employees and can be automated. The last one is project launch and support.