by the daily star.com.lb — In today’s fast-moving world, where it is easier than ever for customers to find personalized products to suit their individual needs, banks are increasingly competing to stay on top of the game. This is coming to mean using big data to measure all customer behavior, advanced imaging to recognize their faces, and even neuroscience to gage their emotions.At Efma’s fourth annual Retail Banking Summit in Lebanon at the Hilton Habtoor in Sin al-Fil Wednesday, under the title of “How to Manage Transformation for Sustainable Advantage during Challenging Times” bankers and business experts from the Middle East and Europe gathered to share insights on how to keep up with customer demand.

Although Lebanese banks are behind many countries in their digital customer service, they’re eager to jump in, despite a lack of hospitable laws. BLOM bank announced a new product that does KYC (know your customer) for loan applications digitally, still pending final approval by the central bank. “We don’t have a digital law. We need to lobby for a law. Instead, we have decided to push the envelope to make the journey a reality,” said Elias Aractingi, general manager for retail banking at BLOM Bank. “The digital loan application means people can apply for a loan completely online. We’re waiting for approval from the BDL. We want to push the old market so we can build a better and more digital society together,” he added. The central bank says it has several digital plans in the works, including an e-government payment system, in coordination with around 10 ministries, to be launched toward the end of the year; and a potential national digital currency, which is still being studied to learn lessons from other countries. Nevertheless, the BDL says it encourages innovation at Lebanese banks. “We encourage banks to go further with technology. We may be conservative with mobile banking, but banks are doing a good job with innovative apps to support customers,” said Makram Bou Nassar, executive director and head of the payment systems department at BDL. “We’re studying requests by banks.” According to Efma, rapidly changing customer demand is becoming a challenge for Lebanese banks and is pushing them to innovate at a faster pace, as they work to cater to the needs of their customers with tailor-made products while at the same time keeping costs low. Throughout the region, bank branches still play a vital role for customers, while few banks are collaborating with non-banking players to keep up with changes in consumer behavior.

“The slowly evolving market is raising the risk for the financial services providers and the banks need to transform in order to remain relevant to the customers and their needs,” said Fahim uz Zaman, Efma’s general manager for the Middle East. “They need to reach their customers more effectively and cost efficiently, ingrain more automation internally, and offer digital financial services propositions which are comparable to what are being offered by large consumer technology companies or Bigtechs.” Areas where banks are looking to get an edge on their competition include: designing digital wallets attractive for millennial customers; using data analytics and big data for cross-selling purposes; developing payment systems for a cashless society; digital onboarding; collaborations with new players and Fintechs; the future roles of bank branches; and questioning how to build a digital future around customer needs. At some banks, what was once implausible science fiction is now reality. DenizBank in Turkey is taking customer personalization to a brave new world of neuroscience and brain scans. “Through eye tracking and cognitive load tests, we’re using neuroscience to measure how customers are feeling. We’re putting ourselves into customers’ shoes,” said Gurhan Cam, deputy CDO and president of the innovation committee at DenizBank, as he displayed slides of a woman whose head was hooked up to electrodes. “We’re tracking brainwaves of customers for a customer-friendly call center. We’re using neuroscience to increase sales,” he said. Similarly, Tatra Banka in Slovakia has recently launched a face biometry system for opening an account, starting with 1,500 students in June. The customer simply gives a face scan, which is immediately recognized, and the account is opened on the spot. “You can open an account in 10 minutes, and get a loan in 10 minutes,” said Tomas Tencer, head of communication and brand strategy. He added that there isn’t the issue privacy concerns because Slovakians already have such digital photos registered with the ministry of the interior. Zaid Kamhawi, CEO of Qarar, a Dubai-based digital analytics consultancy, noted that some banks in the Gulf are already using advanced systems for customer personalization. “Banks are coming to us to explore machine learning. It gives an added value to their business in collections and recoveries. It gives you an indication of who will pay. The key advantage to machine learning is correlations, what traditional analytics can’t do,” he said. “Who will be the first bank in Lebanon that can give customers an immediate credit decision on the spot?”