As the Middle East’s payment services market continues to embrace new technologies that make life easier for consumers, banks such as the UAE’s Mashreq are turning to the fintech sector.
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Mashreq’s digital transformation is seeing it innovate to improve customer experiences and stay ahead of competition.
Pankaj Kundra, senior vice-president – head of payments and personal banking at Mashreq, said this is nothing new – in fact, the bank has been innovating since it was established in 1967.
“We were the first UAE bank to install ATM cash dispensers, the first to issue debit and credit cards and the first to introduce consumer loans,” said Kundra. “We don’t mind taking chances by using technology advancement to improve the customer experience and product innovation. There are various examples in the recent past that I think we take pride in.”
For example, Mashreq recently introduced beacon technology to provide contextual offers to customers as they go about their everyday life. Kundra said most merchants or hotels were under no obligation to tell a client using a point-of-sale (POS) machine that, as a Mashreq card holder, they were entitled to a discount on the purchase, so the bank has launched beacon technology, which is a small box mounted on the wall at the merchant’s premises.
“What it does is that whenever a customer of Mashreq who has a mobile app on their smartphone walks in the vicinity of the beacon, they will get a notification about an offer available nearby,” he said. “What this has done is take away the dependence on looking for a catalogue or voucher to redeem a discount. The customer can confidently ask for the discount, or whatever they are entitled to, in real time.”
Kundra said Mashreq had rolled out 300 beacons with various merchant partners in the UAE and planned to install 2,000 beacons across the country by the end of the year.
“We have extended the beacon technology offerings to Dubai Mall, we currently have a promotion with Tim Hortons, where on certain Mashreq cards [debit or credit], when you buy one coffee, get another one free,” he said. “In the past, a lot of our customers were not remembering and we were only putting information out through marketing materials and emails, which was annoying.
“Now that we have implemented beacon technology, the aim is to take offers that are meaningful to customers at the point where they need them, as opposed to sending email promotions, which people end up spamming.”
Kundra said another example of Mashreq using fintech to improve customer service wass an easy payment option for customers who have has bought something for about $1,500. “Banks offer easy payment plans on credit cards used for large purchases, but with most banks, the client has to either call the call centre or the call centre calls them back,” he said.
In this respect, Mashreq has innovated with all its network POS machines. A large-sum purchase initiated at the POS automatically prompts the bank’s easy payment plan while the transaction is actually happening.
To expand the value of fintech systems to more merchants in the UAE, Mashreq has unveiled an initiative that will see it work closely with fintech providers to bring smaller merchants online.
Through the scheme, Mashreq introduces fintech partners to smaller merchants whose job is to bring them online, said Kundra. “Once online, we provide them with the capability to have the payment enabled on those online platforms,” he said. “It’s a win-win situation to grow that market because the merchants will benefit with increased sales and Mashreq will benefit because our volume will grow.”
According to Kundra, the next big fintech evolution could be around contactless payments, which are coming to the region. Mashreq has already teamed up with Samsung Pay.
“Being the first bank in the UAE to partner with Samsung Pay gives us the ability to learn quickly and adapt to be ready for the next change,” he said. “I think, sooner or later, Apple Pay will come into the UAE market and there are questions about various other wallets coming into the market, which will drive the contactless payment sector further.”
Kundra held up the UK as a classic example of where contactless payments have created excitement in the market. “In the UAE, we believe the trend will follow the UK and probably grow much faster than any other country in the Middle East because of the innovation stance the country has adopted,” he said. “The future is disruptive and exciting for banks, fintech partners and consumers.”