Tap here to download the Cisco News Mobile App for the best Cisco Network mobile experience!

Cashless, Mobile and Social: Are you ready?

Cashless, Mobile and Social: Are you ready?
Are you ready to go cashless, mobile and social? There’s never been a better time.
Cashless, Mobile and Social: Are you ready? READ FULL ARTICLE

Cashless, Mobile and Social: Are you ready?

Ruma Balasubramanian
Cisco Systems
Vice President, APJ Enterprise Business & Digital Transformation

April 18, 2017
  • Press Release

  • 4820

  • Save

  • Technology, Innovation, Digitization, Cloud, Mobility, Security

A decade down the line, cash will be as antiquated as CD’s and flip phones. That is because social media, payments and mobility will merge as the use of social platforms continues to rise. In fact, integration is happening so quickly, it is possible to argue that social media platforms may be the banks of the future!

I know what you’ll say – emerging markets in Asia Pacific & Japan are high cash societies, consumers are worried about the security of new banks and I’m getting ahead of myself. However, there are two major reasons I might just be right.

Countries with emerging markets have a young and social population. The number of Facebook users in India alone stands at 69 million (monthly active users), with all but 5 million logging on with their mobile device. More than 1 in 50 tweets around the world is twittered by a Jakartian, making Indonesia’s largest city one of the social media capitals of the world. And these billions of digital natives consider mobile, seamless and integrated banking a birthright.

Secondly, governments are taking action to stimulate Fintech and go cashless. In fact, Korea intends to be a fully cashless society by 2020. Singapore has also committed SGD225 million to grow Fintech start-ups as part of its plan to go cashless as well. And, as I wrote in my previous blog, India is taking a leap forward into the digital payments future.

With consumer demand and government support at the ready, how can banks take advantage of digital and social? There are many routes to tackle social as a financial services operator in Asia Pacific & Japan. Plenty of banks these days offer some sort of chat as part of their customer service, and they might even scour social media to understand customer sentiment. However, few banks and insurers use social platforms to develop services and products, or support a social platform to help them understand what’s happening with their customer base.

But some are taking the digital leap: full-scale integration of banking services into social platforms. DBS Bank has this digital capability up and running in their innovation labs. ‘I can go into Facebook messenger and chat with my bank, move money,’ says David Gledhill, Group CIO and Head of Technology & Operations at DBS, at the 2016 Cloud Expo (24 minute mark). ‘We have this concept of an invisible bank, and this is part and parcel of that same thing.’ Kotak (India) and Rakuten Bank (Japan) have also opened their doors to new online payments via Facebook and Twitter.

So there we have the billion dollar question (considering the 2.3 billion monthly active users on social media): how can established banks in Asia Pacific & Japan use social media to disrupt their business? Not just as an extension of customer service but integrated into lending practices, payment systems, and other services, to improve customer loyalty and intimacy?

First and foremost, you can choose to invest in, partner with, or acquire the disruptors. This means co-developing new financial products that are themselves integrated into Facebook, Twitter, Weibo, Kakao Talk and others. An example is Ping Pay, a partnership between Axis Bank and Fastacash. And Cisco for example, invests in Fintech startups via venture capitalists like ASEAN-based Monks Hill.

Another way is to skip ahead to the front of the line by centering on the social media platform and building a fully digital online bank around it. This is not an option for established financial players, but is guaranteed to occur more and more.

Let’s illustrate this option with an example. A Cisco customer in Korea, one of the largest social platforms in the country, has turned banking on its head. Some call Korea’s financial services climate ‘rigid’ with very few market players. The credit rating system is structured in such a way that a large portion of the population is unable to secure a loan. Instead, they rely on credit cards and short-term loans at high annual rates, some as high as 27.9%. Our customer intends to leverage their user base (which ranges into the tens of millions) by launching a whole new credit rating system for South Korea. They also have plans to enter the card business and offer investment banking, allowing users to open group bank accounts and pay interest using digital currencies. The digital bank is underpinned by a strong Cisco network with pervasive security to build confidence in the customer’s initiative, and is fully integrated into the customer’s social network. It’s a great example of Korea taking a leap forward on the worldwide FSI stage!

Lastly, banks can develop digital capabilities combined with social platforms themselves. Most banks suffer from a set infrastructure where it is hard to leverage new technologies. However DBS is a prime example of what’s possible. Using their innovation center, they are engineering their own social solution to best serve Gen Y customers.

Are you ready to go cashless, mobile and social? There’s never been a better time.

Also post on Post
Manjit Singh 1 y

Great article Ruma! Provides real-life examples in terms of what is being discussed to help provide color and relevance to what is being shared. Thanks for sharing.