Written By: Roshani Zaidi
Banking was not always as easy as it is today, it was lengthy and time consuming. You couldn’t just sit in front of your computer and pay your bills or transfer money. There was once a time that having money in your Bank account meant having money in that one branch of the Bank that you have account in. And later, in the Eighties, it meant having money with the same Bank only. You could take your money out from the Bank using your cheques but only from the ONE bank where you had your account. Thanks to the innovative minds around the world and many in Pakistan, we can now access our funds from any ATM, transfer them through our cell phones, not stand in lines to know our account balance (yes, just the balance, getting a statement is a different story).
I have made a humble effort here to list the 5 most innovative banking products and services that shaped the banking industry as it is today.
We think of Credit Cards and Personal Loans and the first bank that comes to our mind, at least to the people born before the 90’s, is ‘CitiBank’. Interestingly, it is our dear local Habib Bank Limited that launched Pakistan’s first Credit Card.
However, CitiBank is the one that made its use more common like it did with many other consumer products that we take for granted in this age.
These Banks not only created a need for plastic money but also set up a system with merchants and Point of Sales (POS) that accepted Credit Cards. A whole lot of Banks came up with credit cards afterward adding innovation to this product. The list of value addition goes on with PhotoCards, Loyalty and Rewards Programs, Installment Programs and the recent Chip Cards.
Alternate Transaction Channels – ATM, CDMs and Debit Cards
Have you ever been through the tragedy of getting mugged right after you took a chunk of your salary out of the ATM? Well, imagine having to carry a wad of cash every time you needed to go shopping or just to pay a bill. Especially in a city (read Karachi) where you think twice before going out in public with your fancy cell phone or watch. I, for one, take off my jewelry before I go shopping unless I am going to an inside mall store (God Bless the booming retail industry)
Thanks to Debit Cards we don’t need to carry cash in most places for payment. Just swipe your card and your account will be credited. And since it’s not a credit card, you don’t owe anyone any money. Union Bank Limited which I am proud to have started my banking career with, launched the first shopping card (this I say from memory, since I can’t find any information online stating this or otherwise).
ATM cards, Debit Cards, Cash and Cheque Deposit Machines have revolutionized the way we Bank. It has removed the time and place boundaries altogether. While, it is now convenient to transfer, pay, deposit and withdraw money at any time of the day, it is also safe (again, God bless all the ATMs and CDMs placed in secure places and malls). I have had the privilege to work with another innovative and tech friendly bank Standard Chartered Pakistan Limited that installed the first Cheque Deposit Machines in Pakistan.
Personal Running Finance
This is my personal favorite I have written about this in my website blog based on personal experience. Ready Cash the product where the Bank lends you money in your account and only charges interest if you use the fund. This is again one product that enhanced the definition of Personal Loan for Pakistani consumers. With the introduction of Ready Cash by Union Bank you no longer needed to pay off personal loan in fixed installments or pay for the whole amount on loan issued to you. You can get a limit in your account for hard times and use the money if and when you need it.
Though ABN Amro launched a similar loan product for the purpose of BTF (Balance Transfer) where you could take a running finance facility to pay off any other existing loans. Ready Cash was revolutionary because it came with a debit card and you could use it for any purpose, be it shopping or to pay bills or to meet the month end cash crunch.
Online Banking, Self Service Banking
When I started my first job as an online banker in 2005 I was amazed by the number of banking information and services we could provide through our computers just sitting at our desks. From Balance, to calculations to loan/card payments, fund transfers, pay-orders and demand draft, card/ account activation/ blocking and the list goes on. As it turns out, Citibank started Phone Banking long before in 1992 and self service banking in 1995.
Many Banks now offer Internet Banking. Banks not only encourage customers to make use of technology for transactions and bill payments online but also encourage a paperless environment in their branches.
UBL also offers a similar product ‘Omni’. This is a more convenient way of transaction especially for people who cannot open a bank account.
The Banking and Financial industry is constantly changing, adapting and improving. It is nearly impossible to rank any one product or service over the other as the most innovative. There have been many other innovative products in the last two decades like BancAssurance, Investment Banking, Mutual Funds, Insurance features on DebitCard to name a few and the list goes on. Banks are now coming up with more tools to make payments and transactions more secure, convenient and accessible. I am deliberately leaving QR Code Acquiring and Near Field Communication out of this article as it will require a lot more than a few words to do them justice. This is the future. You can use your cards and cell phones like magic wands, by making payments with a slight tap.
While many of the Banks mentioned here are no longer present but they have done their part in making the Banking and Business more convenient. It is the progressive approach of all the banks of past and present that tasks like routine transactions, withdrawals or deposits are not a half day job for us. They can be done from the convenience of our home or an ATM close by. This is the power of technology.