Thursday, October 8, 2020

Interviews with practitioners: What does it take to transform SME Banking?

Interviews with practitioners: What does it take to transform SME Banking?

Watch our first episode of the DueDil Live Series to find out what the Head of Digital Transformation at Santander UK thinks the future of SME banking will look like.

In the first episode of DueDil Live Series, Denis Dorval, COO of DueDil, welcomed Jonathan Holman, Head of Digital Transformation at Santander UK Corporate & Commercial, to the discussion table.

SMEs are facing unprecedented conditions. A year ago, the digital transformation of the banking industry remained relatively predictable, while recently digital developments have had to progress at a faster rate. At DueDil we believe this is an opportunity to redefine the process of Know Your Business (KYB). Our holistic KYB for Life approach is centred around the idea of taking back control of your business for its full business lifecycle.

To demonstrate how technology-first approach enables leading players within financial services to grow and evolve, we have launched the DueDil Live Series - “Interviews with practitioners: what does it take to transform SME and Commercial banking?”. Denis Dorval, COO at DueDil, invites practitioners, the real transformers within the space, to the discussion table. The aim is to share their vision and demonstrate how the power of technology and innovation can be harnessed as a mechanism of change, helping them drive their customer experience to the next level. 

In the first episode of DueDil Live Series, Denis Dorval, hosted Jonathan Holman, Head of Digital Transformation Santander UK Corporate & Commercial. Jonathan has won multiple awards for his work digitising corporate and commercial systems for the major global bank.

Let’s dive straight into the success you have had transforming digital operations and commercial banking for Santander. Tell us a bit about yourself and how you ended up taking on this project.

I’ve taken on a number of the major banking roles, from centralising, decentralising and automation, and learned about how older systems are used to help those processes. Many of these systems were on-premises, large scale server-based systems that had to be heavily customised to meet requirements. This gave me an insight into the interconnectivity of banking. I’ve since incorporated my hobby - technology - into my job, combining with my banking experience to realise that true transformation will only come when technology is implemented across the whole organisation.

You’ve put a lot of emphasis on the importance of both technology and people. Quite often it’s not put front and centre into the transformation programme.

When I talk to my team about our stakeholders I talk about our colleagues. Corporate and commercial SME banking is still a relationship-led model. We’ve got to make sure our colleagues’ experience, as well as our customers’ experience, is central to our technology implementation.

You’ve joined Santander UK 5 years ago. How has the SME and commercial banking market changed?

We've seen the advent of remote digital working and banking, and that consumer experiences work best when they fit around people’s lives. If you’re managing an SME business, we want banking to fit around you, your business and your customers. As we move into a different era, we’re going to have to continue evolving digital banking in terms of products and services, while also maintaining the trust and relationships we’ve built with our customers and start digitalising that for a remote context.

That’s something I’ve also witnessed: the consumerisation of the B2B space. We’re seeing a profound shift.

We’ve found that customers want help with bureaucracy as they expand overseas. So banks need to deliver trust digitally, as well as core products. We’ve got to find a way to innovate in banking in a way that other industries already have. Many consumer challenges are solvable with the technology that’s available now, so company insights are at the heart of what we do. They facilitate the automation and help us meet the regulations, but also provide those services on a responsive basis to our businesses.

We’ve been focused on the ‘API first’ approach for the last seven years and now others are starting to follow suit. We tell our banking customers that they traditionally benchmark themselves with their peers, but I am encouraging them to also benchmark themselves against other industries. Tell us about the digital transformation you led in the commercial banking space. What was the mandate?

When I started at Santander I thought about how we could build something in the cloud, adjacent to legacy infrastructure, that could do things faster and interrelate more quickly. We prioritised the horizontal functions, beginning with onboarding. We’ve moved from web signatures with witnesses to a digital process with DocuSign. And we introduced parallel processing that meant customers are still eSigning while we are doing financial crime checks and opening the accounts. We would bring all that together with a robotic process automation that opens the account just at the right time.

So how did you convince people internally?

I met with the teams that work in every part of the onboarding process. We worked to understand what people were doing and what problems they faced. Continuity of data was a theme, as was duplication of some controls and checks, and the tasks that people could add value to. Then we combined burgeoning Regtech to say ‘look, there are solutions to these things out there, we can deduplicate the data, we can remove this control, we can automate this’, that was the key unlocking management support.

Choosing a number of new suppliers because they have the best tech doesn’t mean throwing out of the window all the backend systems already in place. At DueDil, we show our customers that they can now choose a single solution without the extra integration costs. Tell us about how you convinced people that you can deliver on that aspect.

IT security, the resilience of the supplier, having so many suppliers to manage: these are material issues that we face. The integration costs are coming down, and as we’ve got more sophisticated API orchestration and platforms that are interconnected it’s making it easier. DueDil had a partnership with TransUnion which meant we could utilise both technologies in one API. That consolidation does create significant efficiencies, the integrations work and we don’t have to maintain them.

Talk to us about the benefits that you have seen across the chain since this transformation.

In onboarding we saw the average end-to-end cycle time come down from 10 to 12 days to about 2 to 5 days. And for lots of small businesses we can automate the process almost entirely. You can achieve a very efficient process with the Regtech that’s available nowadays. In our lending, our fulfilment processes, we’ve been able to take away 80-90 per cent of  the work in producing loan contracts and security contract documents in house.

What do you think will be very different in banking in the next five years?

I think tailored interaction with banks, as in retail, is the future. Banks need to iterate quickly, have the insights to be able to understand customers. For the industry, we must consider how we can change as the competitive landscape changes. We need to think about how we can change our revenue in the future, and deliver those ‘beyond banking’ services to gain customer trust. But also how we can transform core products to deliver them in a remote, digital way that suits how businesses work.

Santander is one of the companies redefining KYB with real-time company insights from DueDil. Our KYB-for-Life platform provides you with fresh insights and is available by API or WebApp. Find out how DueDil can transform your KYB processes.

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