CLOUD & SCALE
87
Ways to make banking better
New virtual bank Mox isn’t keen on conventional numbers, be it the metrics used for market share or the 16 digits on a card. There’s only one big one that bothers CEO Deniz Güven and he’s tearing up the rule book to eliminate it In scoping the market for a radical new approach to banking in Hong Kong, global financial player Standard Chartered compiled a list of things that frustrated customers about legacy systems. There were 87 separate pain points. “And we’re not talking about complaints like ‘there are queues in front of the branches’,” says Deniz Güven, CEO of Standard Chartered’s new challenger Mox. “I’m talking about real pain points. The people of Hong Kong want to do banking quite differently. So, we are creating a service-led bank to solve the pain points.” Mox is built on a new business model – a partnership between Standard Chartered, information and communication technology giant PCCW Global, telecommunications company Hong Kong Telephone (HKT) and Asia’s largest online travel agency, Trip.com. One of the first eight challengers to be granted a virtual banking licence by the Hong Kong Monetary Authority (HKMA), www.fintech.finance
Mox (which started life as SC Digital), is alone among this disruptive cohort to be backed by a legacy bank. Yet the need for established Hong Kong institutions to act on sweeping changes brought about by a new regulatory era was spelled out in a KPMG report only last year. It said: “The development of virtual banking in Hong Kong forms part of a larger ‘unbundling’ story in the banking sector. Our view is that this unbundling will eventually lead to a ‘rebundling’ of services in new and innovative ways as customers will ultimately prefer to use a single efficient interface for all of their banking needs. “This rebundling will lead to a smaller number of winners in the market, likely comprising the few traditional banks that are able to adapt to digital technologies and open banking, new virtual banks and fintechs that are able to knit together seamless services through application programming interfaces (APIs) and other technologies, or some form of hybrid.”
Güven, former global head of design and client experience for digital banking at Standard Chartered, says the HKMA’s Smart Banking Initiative was indeed the trigger that shot Hong Kong’s oldest note-issuing bank into the virtual vanguard. “We asked ourselves two questions: can we defend our market from non-traditional players with our existing operating model? Can we attack this market with our existing model? The answer was an obvious no.," he says. “That’s why we started to think about launching Mox.” The name telescopes mobile, money and experience and its journey began with a research project that reached out to more than 2,000 people from different client clusters. The 87 different pain points in Hong Kong retail banking that it revealed were in part, Güven believes, because ‘when it comes to end-to-end digital services, this is still a premature market’. And that’s despite Hong Kong being aaa cauldron for fintech innovation. Issue 16 | TheFintechMagazine
59