Digitalising The Financial Landscape In The UAE

New technologies today are changing the face of the banking and financial landscape at a rapid pace. Such dramatic transformation can put considerable strain on banks and other financial institutions, especially in qualifying their cadres to meet the demands of an increasingly digitalised environment.

In a 2017 global survey conducted by Capgemini’s Digital Transformation Institute to find out how various industries performed in terms of hiring digital talent, banking fared the worst. Sixty-two per cent of the banking professionals surveyed said that the talent gap in the fast-evolving digital space had widened over the past two years, compared to 55 per cent of respondents across industries.

 Among the 12 most important challenges financial organisations face today, four are related to technology— digitalisation, blockchain, artificial intelligence (AI), and data and analytics, according to a 2018 report published by PwC. And in tackling these issues, companies are rightly revisiting their business strategy. Some banks are more aggressive in their digital transformation than others.

In the UAE, which boasts a highly tech-savvy population, banking customers embrace revolutionary technologies across the board. Blockchain and AI, for example, are already playing a pivotal role in various sectors. The Dubai and the UAE governments have announced plans to use blockchain for all their transactions, and national banks are not far behind. Emirates NBD and Emirates Islamic were among the first financial institutions in the country to adopt blockchain in a bid to prevent fraud.

Furthermore, a consortium of banks is working with the Central Bank of the UAE to leverage the distributed ledger technology to devise a smart ‘know your customer’ (KYC) solution. Applying AI in areas such as big data analytics also bring tangible benefits. Banks process millions of transactions every day. Understanding such enormous amounts of data not only helps develop innovative products and services and, consequently, gain a competitive advantage, but is also useful in other areas of the business, including risk management.

 In fact, bankers in the UAE have reported that AI, including chatbots and even robots, made interaction with customers easier, and transactions faster and smoother. Commending UAE banks for their sweeping digitalisation and implementation of AI, HE Abdul Aziz Al Ghurair, Chairman of the UAE Banks Federation, said that such technologies could reduce operational costs by 50 per cent.

As the banks continue to implement their digital transformation strategies and drive business forward, it is critical for them to realise that the fight for digital talent transcends industries and borders— and therefore, they must look within. This means making the entire workforce aware of the disruption technologies will create—if they have not already done so—including robots replacing certain employees. There is no need to gloss over the fact that some redundancies are inevitable, especially for jobs that involve repetitive tasks.

If this is done right, the staff will be ready to embrace the changes that digital transformation brings with it and be prepared for reskilling and upskilling. As in any legacy system, many workers will have apprehensions about new technology. However, they need to decide whether they wish to be part of the changing landscape or not, and if they do, training will be essential.

In a country such as ours where there is a scarcity of talent, we must look for skilled personnel abroad, it is imperative that we train the existing banking workforce in emergent technologies, starting with the current members of the banks’ IT teams. To achieve this priority, Emirates Institute of Banking and Financial Studies (EIBFS) has launched the Fintech Training Lab, comprising a series of courses that will be delivered by fintech experts of banks over a period of two days.

To keep pace with the latest developments and global best practises across the board, the Lab will invite international experts to hold workshops for banking professionals in training. In addition, there are plans to establish an innovation incubator for the banking sector. Bank employees outside IT departments should also be aware of the new applications and their impact on dayto- day operations that involves optimising processes and driving efficiencies, as well as early detection of risks and fraud.

In the context of achieving a paradigm shift in the customer interface that the latest technologies have already introduced and are set to intensify, it is crucial for the front office as well as the back end to understand the operational value of implementing these applications. This understanding will, in turn, ensure the adoption of a more agile and collaborative approach in their functions.

With our government at the forefront of embracing new technologies, as evidenced by the appointment of a minister of artificial intelligence, it is vital that we nurture an interest in this dynamic field among UAE nationals. Talented young college-going Emiratis who are eager to know more about banking and finance technology should have access to relevant professional training. Banks in the UAE have a special role to play in this regard, and as a banking training institute, EIBFS is keen to develop national cadres wellversed in these cutting-edge applications through its Fintech Training Lab.