DBS uses data and technology to better serve all customers

DBS sends out a whopping 30 million nudges a month to its digital banking app users in Singapore, reminding them about gaps in their financial plans, flagging any overspending and alerting them to possible unauthorised payments - like an attentive personal assistant.

That means one million such hyper-personalised messages or insights pop up every day, doing the heavy lifting for its retail and private wealth customers, helping them to move forward on their financial planning journeys.

This is the result of 250 artificial intelligence (AI) and machine learning models - the fruits of labour of the 580 data scientists and machine learning engineers at DBS, who tap into a database with more than 15,000 customer attributes to generate AI-powered nudges, Jeremy Soo, Head of Consumer Banking Group at DBS Singapore, says.

"Today, digital banking is really a baseline for all financial services providers... The true test for banks is how they leverage data and innovative solutions to help customers grow and protect their monies, more so now during such uncertain times with persistent market volatility and soaring inflation."

DBS' investments in systems, technology and talents amount to S$1 billion a year.

Mobile-first strategy, customer-centric and lifestyle-oriented apps

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The top stock by market capitalisation of about S$88 billion on Singapore Exchange and the biggest bank in Southeast Asia, started its digital evolution in 2014, steered by a mobile-first strategy.

Its digital banking app was born, with a companion payment app DBS PayLah!. The digibank app provides banking and financial solutions while DBS PayLah! is a lifestyle-oriented mobile wallet.

While the bank did not tout it as a super app, DBS PayLah! is one in substance as it allows its more than two million users to perform various tasks, including booking tickets, ordering food, hailing rides and keeping tabs on their card reward points - all within the app.

This has thus removed the need to download these lifestyle apps onto one's handphone, and more importantly, does not take up the limited space in the handphone and also makes it look less cluttered.

DBS PayLah! is also accepted at over 180,000 merchants for bill payment in Singapore and has recently gone beyond our shores, under partnerships with two leading foreign mobile service providers.

The tie-up with UnionPay gives DBS PayLah! users access to a network of 31 million bricks-and-mortar retailers in 45 markets, including China, Malaysia, Japan, South Korea and Thailand.

Also, PromptPay in Thailand allows DBS PayLah! users to make payment conveniently at more than eight million merchants, retailers and facilities, such as train stations in the country.

Soo says: "If we want to make a difference to our customers, we must be in the daily aspect of their lifestyle."

Although the digibank app and mobile wallet could have been accessible as one app, which will also be as robust in terms of security, DBS was cognisant of the sensitive transactions conducted in the digibank app and took on board customers' security concerns to ringfence their bank accounts, and thus provided the two as separate apps.

However, users can toggle between the two apps seamlessly with just one tap.

Besides offering users convenience, DBS PayLah! captures data on customers' consumption patterns, providing useful input for AI. This in turn drives better experiences for both DBS PayLah! and digibank app users. This is what sets DBS apart from its competitors, Soo says, in addition to its apps playing an integral role in customers' lifestyle.

DBS did not stop at the initial functions for the digibank app and has since added several features, including one that facilitates financial planning - the DBS NAV Planner.

"As a bank, we should be in a very good position to help customers plan their finances," Soo comments, pointing out that a customer's account captures both income and expenses, including mortgage payments and insurance premium payments.

This allows the bank to help customers uncover any financial gaps, track progress towards financial goals as well as get advice on optimising savings and investment, among other financial planning functions.

DBS NAV Planner now has 2.8 million users - about half of Singapore's population - and 35 per cent of these users tap the function to actively keep tabs on their financial planning. "It's a very powerful engagement tool."

Soo says that customers have taken action and made progress on their financial planning journey, such as saving for a rainy day, since using DBS NAV Planner.

By leveraging technology and insights from the data, DBS has avoided productdriven hard selling that irks customers. Instead, the bank is able to recommend customercentric products based on customers' needs.

DBS observed a fourfold increase in the number of customers who completed their investments, after the bank launched its AIpowered digital investment advisory feature that can determine individualised investment risk profiles and make specific recommendations.

Soo says DBS NAV Planner has also helped raise customers' awareness about retirement planning, including various investment schemes such as the Central Provident Board Investment Scheme (CPFIS) and Supplementary Retirement Scheme (SRS).

Customers who have used the retirement feature within DBS NAV Planner have more than doubled over the past year.

It not only furnishes customers a chance to invest their idle funds to possibly reap higher returns, but also provides DBS, as an agent bank for these investment schemes, the opportunity to add value.

The bank expects it can get one million users to insure or invest through its digibank app by the end of 2023.

'Phygital' framework to serve three generations of users

Despite the perception that harnessing data and technology means the less technologically-savvy users, often the seniors, will be left behind, Soo underscores DBS' commitment to serving what he describes as the three generations of banking customers: the passbook users, the automated teller machine (ATM) users and the mobile app users.

"So when we embark on this strategy, we see it as... a "phygital" framework where we are relevant digitally as well as physically... The entire network has been transformed in such a way that we can create accessibility 24/7 and (are) also relevant to the elderly."

Soo says technology has facilitated customer transactions such that nine in 10 overthecounter transactions can be performed on selfservice machines such as video teller machines (VTMs) or its digibank app.

DBS has observed that 43 per cent of customers who used to do banking only at its branches now use selfservice machines, digibanking, DBS PayLah! or other channels, embracing the benefits of not being limited to the branches' opening hours and geographical presence.

Still, the bank will not foist self-service on passbook users, assures Soo, as DBS remains committed to serving them in the physical manner. "We are not saying because we go digital, because we go automated, we leave behind all the passbook users. The whole idea is segment-agnostic, financially-inclusive."

Serving the various segments with a digital overlay is a "very, very, very powerful" strategy, Soo points out. It not only improves customer experience, but also raises efficiency that would ensure an appropriate cost-income ratio, thereby addressing shareholders' concerns. That strategy also will ensure the bank, including its POSB brand, stays relevant to Singaporeans.

POSB has not forgotten its role to inculcate healthy financial habits in young Singaporeans, given its history in nation-building days as the vehicle tasked with the mission to drive the national savings programme among the young.

It now possibly has the world's first wearable with a savings programme for sign-up by school-going children, for cashless payment. In the form of a smartwatch embedded with a payment chip, the wearable known as POSB Smart Buddy is paired with a mobile app that gives parents control and oversight of the kid's spending in schools and at retailers that offer Nets payment mode.

By the end of this year, POSB expects to have 140 out of 360 primary schools, secondary schools and junior colleges enabled with POSB Smart Buddy capability, Soo shares. "The vision going forward is we want the future leaders of Singapore and the future generations of Singaporeans to say they grew up with POSB Smart Buddy."

Besides Singaporeans, DBS - as a bank of purpose - is also committed to serving work pass holders. It has started with migrant workers and is working with the Manpower Ministry to set up bank accounts for these work permit holders digitally.

This role, Soo notes, became pronounced in 2020 when the bank - in the short span of a week - opened bank accounts for as many as 50,000 migrant workers stuck in the dormitories, helping them to be paid.

When asked about challenges in leveraging data and technology, Soo says it is to instil alertness into customers without making them overly paranoid, as he notes the increasing number of scams globally.

Convincing users that DBS is using their data to enhance the customer experience without compromising their privacy could be another challenge.

"The financial industry is much more regulated than other consumer sectors, and we have all the necessary safeguards that govern responsible usage of data. Throughout DBS, we also have in place a responsible data use framework called PURE - in which we ensure that data must be purposeful, unsurprising, respectful and explainable for all our customers."