Alliance Cash2Home - A Best Practice in Mobile Onboarding - Silverlake Axis
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Whitepaper Alliance Cash2Home – A Best Practice in Mobile Onboarding Sponsored by Silverlake Axis Limited SITUATION OVERVIEW Malaysia’s mandate for financial inclusion has incubated a new generation of technology- enhanced banking offerings, and with them, new expectations. Among the leaders shaping this emergent space is Alliance Bank, with its launch of the Alliance Cash2Home secured mobile foreign remittance application. This solution targeting the nation’s sizable demographic of migrant workers, promising a hassle-free, streamlined experience. The simplicity of the Alliance Cash2Home app belies many technical and design complexities that have long challenged financial institutions, ranging from electronic KYC (know-your- customer) reporting to multifactor authentication. At its core, the app uses biometric facial recognition technology to authenticate users, and optical character recognition to scan official documents. Using these platforms, it enables paperless mass account opening and ATM card activation at the employer’s premises, and as well as enabling remittance services through the mobile form-factor. Substitution of conventional username-and-password authentication also reduces the user’s susceptibility to phishing attempts and frequency of account recovery tickets. For the business owners, Alliance Cash2Home solution has proven to be invaluable in cutting down the time their administrative staff spends on payroll processing. The built-in automatic salary crediting eliminates the inconvenience, input errors, and possible security breaches from physical cash-handling. Functionally, Alliance Cash2Home is linked to a migrant worker’s savings account where payroll is debited. This allows any remittance order to be credited directly from the issuer’s salary account to the beneficiary’s agent, negating the need for risky physical cash handling or unnecessary intermediation. The user-centricity of the app’s design is further demonstrated through the considerable effort made by Alliance Bank’s product team to enable native language support for all major migrant worker nationalities. By eliminating barriers in usage, the bank can then proceed to effectively provide incentivization features such as preferential interest on savings accounts, free mobile top-up, in-app rewards, based on repeated usage. Findings from the app’s post-launch user survey were very encouraging – 65% of enterprise respondents said they would sign up for the app, and 27% said they would consider signing up. Meanwhile, all foreign workers surveyed were unanimously committed to enrolling. June 2018, IDC Financial Insights Asia/Pacific #a
Alliance Cash2Home is a cornerstone on the Alliance@Work ecosystem initiative, founded as one of the four strategic priorities of the bank’s overarching digital transformation agenda. In the most recent financial year, Alliance@Work not only gained over 10,000 consumer CASA accounts, but CASA balances per company themselves improved to 45% on average. Less than a year after it was launched, Alliance Cash2Home’s innovative value proposition has garnered regional accolades including the “Digital Transformation (DX) Leader in Omni- Experience Innovation” at the inaugural IDC DX Awards 2017. It was also Highly Commended for “Excellence in Mobile Banking – Customisation” and for being the “Best Multi-Channel Offering” at the Retail Banker International Asia Trailblazer Awards 2018. Alliance Cash2Home represents the Bank’s intention to explore the application of digitalization, specifically workflow digitisation and biometrics that utilize ‘high-impact’ technologies. In the near-future, these technologies are expected to be deployed in other lines-of-businesses. Given the importance of such IT assets to the bank long-term business roadmap, the bank has partnered with Cyber Village, a wholly-owned subsidiary of Silverlake Axis Limited based in Malaysia. Cyber Village also provides services to over ten Tier 1 and 2 bank clients across ASEAN. CHALLENGE As of end-2016, the Malaysian Ministry of Home Affairs reported as many as 1.85 million foreign workers with Temporary Employment passes. The Malaysian Ministry of Human Resources further estimates this number only account for 58% of the total migrant workforce present in the country. To Alliance Bank, this market of over three million financially underserved individuals lacked a dedicated suite of services tailored to the profile of immigrant workers. Beyond just repurposing existing retail and/or mass market banking products, Alliance Bank had to address the financial adoption barriers, unique to the segment, notably language, education, wealth, digital behavior and KYC regulations. Alliance Cash2Home represents not just a more effective means to deliver targeted financial service, but also an alternative model that ensures users, be it migrant workers or their employers, can easily and affordably access value-driven offerings. The initiative supports the Malaysian Government’s Budget 2017 financial inclusion mandate, especially among the foreign worker community. Alliance Cash2Home empowers foreign workers by providing a value-added platform to manage their finances responsibly. ©2018 IDC Financial Insights Asia/Pacific a 2
SOLUTION In 2015, Alliance Bank carried out a Forward Positioning Research (FPR) to understand how its target segments perceive the Bank. The FPR also helped the Bank identify opportunities in the market, and target segments’ expectations. Based on the FPR, Alliance Bank proceeded to redefine its brand architecture, focusing on faster, simpler, and more responsive solutions that are better-aligned to its customers’ needs. And from this, Alliance Cash2Home was conceived. The outcome is an innovative financial product that addresses the concerns of all its stakeholders: the business owner, foreign worker, and regulators. Through new, readily-available mobile technologies, Alliance Cash2Home aimed to enhance onboarding, usability, and servicing. The solution reached its first major development milestone in early-2017, with Alliance Bank securing regulatory approval to use smart-device- based facial recognition as a means of meeting KYC requirements during account opening. With this product, both the employers and foreign workers have facing significantly fewer risks in handling cash as foreign workers are paid directly into the bank and remittances are done online by the foreign workers at their convenience. From a cyber-security standpoint, Alliance Cash2Home leverages on facial biometric authentication application. This is more secure than the traditional eight-to-ten-point fingerprint validation. This is the solution’s first factor of authentication. It relies on the user’s immutable physiological attributes rather than rely on the user’s memory on security password phrases. This reduces security risks due to human error as the credentials cannot be straightforwardly phished or misplaced. Operationally, by performing mass onsite account opening and on boarding, the Bank improves user experience for the foreign workers and reduces work downtime for the employers. This is done by early preparation of identification and work permit data of foreign workers to capture biometric data on-site, saving them the journey of physically going to the Bank branch. The second factor of authentication is completed by linking the worker’s phone number to the account. At the same time, the worker’s payroll account is opened onsite and linked to the employers’ institutional account, allowing easy management of employees’ payroll accounts by the business owner through the Alliance BizSmart Online Banking enterprise portal. To address compliance and to facilitate app usage, the team conducts on-the-spot KYC and user training. Users will receive automated alerts when monies are credited or debited from their payroll- linked account. When foreign workers receive their salaries or send money home, they will receive an automated status and transaction alert. ©2018 IDC Financial Insights Asia/Pacific a 3
Alliance Cash2Home currently supports foreign remittances to nine principal immigrant home countries, which are Indonesia (40% of addressable market), Nepal (22%), Bangladesh (13%) and Myanmar (8%), India (7%), as well as Pakistan, the Philippines, Sri Lanka and Vietnam (approximating 10% in total). Alliance Bank aims to improve the enrollment process by mitigating the cost-of-servicing for mass market clients. Current Malaysian KYC regulations require individual prospects to be physically validated by a qualified bank staff. On average, this causes the loss of up to 60% productivity in retail banking. Alliance Bank engages migrant employers directly, mainly from the manufacturing, domestic services and construction sectors. This is done to attain a high volume of users through remote direct onboarding. RESULTS Over the first few weeks of going live, Alliance Bank already began reaping the benefits of Alliance Cash2Home's experience-first design. Mass account enrollment per session is now possible. With self-service-enabled functionalities of the app, a single bank officer can be charged to activate accounts, channels and debit cards, making the onboarding process that much leaner. These self-service design elements leverage on visual instructions to reduce the complexity for new users, while being supplemented by inbuilt multilingual tutorials. In the first 6 months of its operations, Alliance Cash2Home has increased the monthly productivity of onsite services vs. services provided at branches by more than five folds. At 3% staff strength of the branch, Alliance Cash2Home account opening production stands at 17% on a monthly basis. This number is expected to continue to grow over the next one year as the bank continues to focus on mobile as a mainstream on-boarding channel. Foreign workers are primarily served through the Bank’s existing Payroll Savings Accounts that provide basic deposit, ATM access, privilege remittance services, simple account views and management, as well as prepaid top-up facilities. Meanwhile, enterprise clients are provided with a full suite of employer banking functionalities through the Alliance BizSmart Online Banking platform, including scheduled salary disbursals, worker permit and documentation management, and linking/unlinking of Alliance Cash2Home accounts. ©2018 IDC Financial Insights Asia/Pacific a 4
FUTURE PLANS Alliance Cash2Home app proves that with the right technology and partners, the value of ‘traditional’ financial services can be applied to all. Although focused on foreign workers’ inclusion at the moment, the Alliance Cash2Home proposition will be expanded to local employees as a holistic solution to the Bank’s business owner customers and their employees. ©2018 IDC Financial Insights Asia/Pacific a 5
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