The banking sector is moving away from hiring traditional banking qualifications as it looks at harnessing the different innovations and skills that young people have.
This has resulted in the sector hiring those deemed more brilliant than the traditional workforce that previously worked there.
“If you asked me ten years ago what qualifications one needed to work in a bank, I would probably have said a Bachelor of Commerce degree in accounting, marketing, economics or management,” said First National Bank Chief Executive Officer Dennis Mbingo, who was presenting on ‘Innovation and Technology in the Financial Sector’ during the second day of the Swaziland Economic Conference 2017.
He said this was the traditional mix of executives and managers running a bank. Mbingo said this has all changed due to the strategic realisation that there is a traditional and digital bank which speaks to the innovation policy conversation.
Hence, he said it was in this regard that the bank has spread its horizons and hired within the ranks of engineering specialities such as chemical, industrial as well as actuarial science graduates. He said the bank was now prone to hiring young people with majors in applied mathematics who have never studied debit and credit.
“In the talent and mix, we have seen the need to hire people smarter than ourselves because of the strategic conversation,” he said, further stating how this came about due to identifying their own limits in thinking.
“When you talk to people who have been in the same profession for 20 to 25 years if there is a problem and you ask them for solutions, what do they default to? They default to solutions they came up with over 25 years ago,” he said. He recalled how he was told on several occasions that the way of doing things was not that which he came up with when he joined FNB, “I was told that the success of the bank rode on the fact that things were done in a set manner.”
Mbingo said it was for this reason that they hire young people as it enables them to be flexible; “all we want them to do is use their mathematical appreciation and creative thinking to build models”.
He highlighted how one of these models has seen their personal loan book, which is driven by paper applications which has to go through 10 people before approval, can be reached. Instead, the bank now has a decision making process which is 90 percent automated where algorithms decide whether a person qualifies for a loan or not and this has seen their losses decrease considerably.
“There is a reason for that. When a person comes around, despite not qualifying for a loan, compassion kicks in and you find a way of assisting. On the contrary, the algorithms within our systems don’t have a heart,” Mbingo said.
He said they had noted an increase of successful loans reaching 800 percent over a very short space of time. Responding to a question on what informs their innovation, he said it was the genuine respect for one thing; “money is not paper money, but a simple equation. It is a promise to transfer value to someone and the expectation to receive value from someone else.”
Mbingo said the moment that people understood that money is not the piece of paper they hold, it opens the door to a lot of possibilities. He alluded to the fact that the financial sector in Swaziland is brilliant. He was however quick to state that the sector is not good enough.
He said this as he recalled the history of his bank and its conquests in making a mark within the banking sector. Mbingo highlighted that even though he cannot deem it perfect, Swaziland is light years ahead of most African countries.
Acknowledging that criticism comes with the turf, he said FNB started out by modernising its operations and on noting that this was not enough, they resorted to augmenting the traditional banking model with technology and this was manifested by the introduction of automated teller machines as well as point of sale devices.
“This was supposed to support what we had as a business. However, as years went by we noted how what we built was supposed to augment, supposed to support, and had actually taken over. It was now the bank,” he said.
He said the initial perception was that they were running two separate banks, the traditional one and that which they were yet to identify. “We took quite some time defining it and at this point, we are actually running two businesses under one umbrella. One is the traditional bank, and the other is the digital bank,” Mbingo said.