KUALA LUMPUR: There will be a first-mover advantage for banks who venture first to invest in digitalisation as any digital transformation has a fairly long lead time to complete, OneConnect Financial Technology Co Ltd country manager for Malaysia Geh Yang Chia said.
In an interview with the New Straits Times recently, Geh said some banks had decided to invest to digitally transform themselves before digital banks were ready to compete (most of them are still building their banking systems).
On the other hand, there are also banks who are more careful, despite their alert on this new competition and are still taking incremental steps to see how best to respond.
"Based on what we have observed, many banks are rethinking how to expedite their own digital transformation. However, this rethinking is not leading to consistent responses to these new competitors.
"Banks that have inculcated the transformation mentality into their business operations, and who have embarked earlier on this journey, will be more ready to meet the challenges and potential to change the competition landscape drastically by themselves," he said.
OneConnect is a technology-as-a-service platform for financial institutions listed on the New York Stock Exchange.
The company is an associate of China-based Ping An Group, a conglomerate whose subsidiaries provide insurance, banking, asset management, financial and healthcare services.
Geh said within the last two years, OneConnect had secured a permanent location for the OneConnect team at KL Sentral.
Occupying a whole floor at 10,000 sq ft, it has now a permanent home base to continue its expansion in this country.
"We have since hired more than 80 talents in this country, comprising of technology and business development talents, and we are still growing," he added.
Geh said OceConnect had also established a Regional Digital Banking Operations team here in Kuala Lumpur, to better provide after-delivery services and support to clients within the Asean region.
"This enables OneConnect to provide end-to-end tech solutions and services to our clients," he said.
OneConnect also offers insurtech solutions.
Geh said with an industry that was heavily reliant on insurance agents and majority of the insurtech that was currently in Malaysia tackles sales and distribution, Geh said general insurance was more susceptible to digital disruptions than lief insurance.
That is because it is a need-based product which everyone would purchase (e.g. a motor insurance).
"It's fairly standardised and almost everyone has a good understanding on how it works. To offer this through a digital journey has a lot less obstacles and as long as the pricing is competitive and the claim process is easy, many consumers will switch from current traditional channel.
"Our parent company, Ping An Group, is a top player in general insurance field in China. Many digital insurance capabilities have been built which can be of value to insurance companies here including lifestyle-based insurance, smart motor insurance claims and more," he added.
OneConnect is currently working to improve the capabilities and functionalities of its current suite of solutions.
"The Smart Collateral management solution is one of the enhancements that OneConnect is focusing on. Instead of being limited to a standard set of collateral types and rules, the enhancements give clients the freedom to create their own," Geh said.