Prince Bank Plc., headquartered in Phnom Penh, Cambodia, has made great strides in meeting the financial needs of its retail and commercial customers since it began operations in 2015 as a private microfinance firm, Prince Finance Plc. In July 2018, it was granted a commercial banking license by the country’s central bank, National Bank of Cambodia (NBC). Prince Bank unashamedly aims to win the “Best Digital Bank in Cambodia” title and has made admirable progress toward achieving that goal, especially during the nearly two-year-long pandemic, launching a variety of innovative digital and mobile applications to fulfil its vision of being “the financial institution of choice for our target customers”. The bank offers an array of financial products and services, including current and savings accounts, term deposits, home and personal loans, and business credit through multiple channels. Prince Bank has, in a short time, built up a network of 32 branches across the country with plans to install more so that it can reach a broader range of customers, all to realize its mission ofhelping “our customers succeed through professional financial services”. This determined bank also takes its corporate social responsibility (CSR) activities seriously, focusing on education, environment and culture.
International Banker was pleased to be joined by Mr. Honn Sorachna, Chief Executive Officer, and Mr. Bryan Min, Chief Digital Officer, of Prince Bank to discuss their recent progress in meeting their ambitious goals in challenging times.
Mr. Sorachna and Mr. Min, I appreciate your taking the time to talk with me today….
To start, Mr. Min, among the bank’s key strategic aspirations is to be the best digital bank in Cambodia. How far off would you say that you currently are from achieving this goal? And what do you consider to be the single most important task the bank still has to accomplish to get there?
Becoming the “Best Digital Bank in Cambodia” is our goal and also an inspiration to us. This is a journey that never stops; we must not only surpass our peers but also constantly surpass ourselves. After two years of development, we have taken a leading position in the market in terms of concepts and some key product functions, but there are still many areas for improvement. To achieve such a state, we needed continuous support from all stakeholders, gained through building consensus and joint action across functions in the bank. Among them, most importantly, is the speed of innovation and fast implementation, which will give us the lead and widen the gaps between the competition. While drawing on the world’s best practices, combined with Cambodia’s social and cultural needs and market-supervision environment, we have quickly adapted and transformed ourselves to take that lead.
Mr. Sorachna, one of the bank’s stated core values is being “entrepreneurial—we see beyond our current situation and resources and have the courage to make tough ‘yes or no’ decisions.” Can you provide a suitable example of Prince Bank utilising this entrepreneurial spirit in recent times, particularly in response to the COVID-19 pandemic?
One example of such an entrepreneurial spirit is the recently launched PRINCE MobileBiz and PRINCE Merchant digital-banking applications, which cater to businesses and merchants, respectively. Most businesses have seen their operations impacted by the pandemic (lockdowns, social distancing, non-physical handling of cash, contactless payments); consequently, digitalization of their businesses has become ever more pressing and urgent. With these two apps, SME (small and medium-sized enterprise) businesses can use our mobile apps immediately without investing in infrastructure and systems, allowing them to leverage on us immediately and spend more time and resources doing what they do best—getting more business rather than being bogged down with financial processes, such as daily settlements of accounts or making payments or checking receipts.
Mr. Min, it has been around two years since Prince Bank formally launched its digital-banking journey. Are you satisfied with the progress made by the bank in terms of digitalisation during this time? What is the single most significant aspect of the journey that the bank has accomplished so far?
Since its official launch in October 2019, PRINCE Mobile has continuously been updated and upgraded with better capabilities, allowing us to provide better services and offer enhanced product and service experiences. In addition, we have also supported the development and improvement of operational-service processes. All of these have enabled us to provide our customers with better remote-banking accessibilities during the COVID-19 pandemic and continue to support our customers’ and businesses’ growth. For this, my team and I are deeply proud. And the management continues to be supportive of the strategy of becoming the “Best Digital Bank in Cambodia”. At present, the overall penetration percentage rate of our digital-bank users to total customers has exceeded 74 percent, and this rate is still increasing. Almost all new, qualified customers are using our digital-banking products.
On the Prince Bank website (the “CEO’s Remark” section), you, Mr. Sorachna, specifically mention the emergence of globalization under the Government of Cambodia as leading to “the remarkable development of all sectors” and as being important in enabling bank organizations “to play active and effective roles in promoting the socio-economic development of Cambodia”. Do you see the coronavirus pandemic severely impacting the extent of globalization over the next few years, and if so, what does that mean for Prince Bank’s prospects during this time?
Just like all sectors in most countries in which the COVID-19 pandemic has impacted the economy in one way or another, Cambodia is included. What’s important for us is to lend our hands in the economic recovery, and we stand ready to offer help to all sectors. The full impact is yet to be seen, but we are doing all we can to support the local economy. We have also partnered with the government’s Credit Guarantee Corporation of Cambodia (CGCC) to offer business loans to help locally owned businesses tide over or even grow their businesses, and the same with the SME Bank of Cambodia. The next move for globalization depends on multiple factors, and we will have to observe how it pans out with the largest players globally. We will do our best to support the Kingdom, its people and economy. We’ve also continued to support the National Bank of Cambodia’s (NBC’s) many key initiatives, amongst them real-time funds transfer with Bakong (a peer-to-peer funds-transfer service) available to retail customers of local banks, financial institutions and payment-service providers in Cambodia) and KHQR (a single QR [quick response] code for receiving payments from any mobile-banking app in Cambodia)—we are the first to do so amongst all the banks. These initiatives are timely in the ongoing pandemic, and our customers will find them useful.
Has Prince Bank been incentivised to accelerate its digitalisation journey since the onset of the coronavirus pandemic, Mr. Min? And, if so, which specific aspects of the bank’s digital strategy have been given the most development focus as a direct response to the limitations imposed by the virus?
As stated, becoming the “Best Digital Bank in Cambodia” is one of the key strategies for Prince Bank’s future growth. Especially so during this pandemic, we have further increased our investments and accelerated the associated processes to support this strategy. With the help of our robust and scalable internal, online-office, digital-platform portfolio, most of Prince Bank’s internal collaborations no longer depend on face-to-face contact alone. At the same time, we have also launched a series of products to enable our business customers to digitally transform themselves to meet the challenges of the pandemic. In the past year, we have successively launched PRINCE Merchant, which helps offline merchants manage their daily business; PRINCE MobileBiz, which allows business customers to remotely process single and batch domestic payments and make foreign payments; PRINCE Pay, which helps customers realize their online business operations. These new products are designed to allow us and our customers to better meet the challenges of the pandemic and jointly shape a new way of doing business.
In June, Mr. Sorachna, you told The Phnom Penh Post that one of the key phases for Prince Bank’s digitalisation journey is to promote openness: “We will continue to invest in the capacity building of digital banking, open connectivity with full compliance and build an open digital banking ecosystem to connect more partners and business scenarios.” How much of this objective is represented by forming strategic partnerships with the fintech (financial technology) sector? And do you have any examples of such collaborations that you have already undertaken?
As you rightly quoted, we are on a continuous journey to shore up capacity and widen our ecosystem, all with the aim of being customer-centric and, with it, delivering better products and services to our customers with enhanced service experiences.
We are currently working with more fintech partners for money transfers for the domestic market or global remittances for business payments, plus an insurance company offering bancassurance products. We are also looking at comprehensive cooperation with other online platforms—with telcos and shopping and food-delivery platforms, on cross-referrals and billers such as utilities and services companies—for our customers’ life conveniences.
How important is the SME sector as far as Prince Bank’s customer focus is concerned, Mr. Min? And to what extent do you believe the bank’s recently launched PRINCE MobileBiz (SME platform) mobile-banking application will help expand its business potential within the SME sector?
The SME sector is an important contributor to the Cambodian economy and social life, as well as an important player in connecting upstream and downstream supply chains and individual customers. In view of this, Prince Bank has always attached great importance to serving its SME customers. We recently launched PRINCE MobileBiz and PRINCE Merchant, an SME platform through which we provide differentiated and high-quality services to this customer segment, helping them handle their financial business remotely, more conveniently and efficiently. It can also effectively help solve the pain-points under the challenges of the COVID-19 pandemic and meet their needs for digitalization, as well as provide support for their digital transformations. Having launched these two products recently—which have been very well received, especially with those new businesses positioned as online/digital—we can grow together with these customers to realize their visions and goals.
In the short span of two years, Prince Bank has built a strong network of 32 branches and deployed 74 ATMs (automated teller machines) nationwide—and this network is still growing. Do you have target numbers for how much further you intend to expand it? And what implications does the coronavirus pandemic have for the number of bank branches in the long run, if any, Mr. Sorachna?
Indeed, we have grown exponentially in the last two years; we have a long-term vision to service all our customers, present and future, across all channels in all provinces in Cambodia. Customers can use these multiple channels to perform their desired banking transactions or services at their convenience. Physical branches serve their needs for particular segments, and our digital-banking applications serve another segment of customers who value their ability to obtain remote accessibility, whether retail or business owners. In our assessments of future branch locations or expansion of our ATM locations, we remain agile and open to opportunities that may present themselves to us.
So, Mr. Min, what do you consider the most exciting single technology Prince Bank is currently utilising, or plans to utilise in the near future, as part of its digitalization journey (for example, artificial intelligence, blockchain, biometrics)? And in what specific area of the bank is this technology being implemented?
The foundation of digital banking is its technology-driven capability. At present, our PRINCE eAccount product uses artificial intelligence and biometric technology to implement our eKYC (electronic know-your-customer process). After a vigorous period of verification and testing, the current system is robust and reliable, thereby providing us with a sound foundation for the eAccount. To be future-ready, we will continue to explore and create in-depth applications of big data to improve our business-opportunities discovery, business models, business innovation, risk control, etc., and develop more expertise in building better digital-banking products.
Additionally, our Loan Management System (LMS) and e-Loan are our two organically integrated credit digitization products. LMS enables online automation of loan examination and approval, improves the bank’s internal circulation efficiency, reduces the manual/human-related error rate and digitizes data and information in the process to facilitate future continuous mining and management.
And e-Loan is a customer-oriented product based on LMS. Customers can initiate applications through self-service channels, such as the PRINCE Mobile app. After going through the bank’s risk-control evaluation system, LMS has a predefined special process to automate processing, realizing fast application approvals and fast lending disbursements. The whole process is conducted online, without the customer needing to visit any physical branch of the bank. These two products will lay a solid foundation for Prince Bank to further release more smart credit products in the future and further enhance our overall credit products and services.
How has the pandemic changed your approach towards banking leadership, if at all, Mr. Sorachna? And what has been the single most significant challenge the pandemic has presented to you as the bank’s chief executive?
The pandemic has caused many disruptions but none more than to the physical interaction between our customers and employees. As with all disruptions, we will eventually find a way around it. For our customers, we are fortunate in a way; we have a very robust digital-banking platform, which saw us upgrading PRINCE Mobile, and we launched two other business-related digital-banking applications catering to their specific needs. For our employees, constant engagement and our PRINCE HR In Pocket mobile application help our staff obtain HR (human resources) services remotely as well as conduct daily COVID-19 health assessments and weekly uploads of COVID-19 test results. I would have to say that perhaps technology saved the day for us at Prince Bank.
PRINCE Mobile, the award-winning mobile-banking application designed to meet many of the banking needs of your customers, is among the bank’s most impressive digital-banking products and services. What are some of the key features that differentiate PRINCE Mobile from the apps of other banks within the local market, Mr. Min?
We are very happy and proud of what PRINCE Mobile has achieved so far. Fundamentally, it is not only a delivery channel of financial services but also an ecological platform, a financial-services portal for the digital population. With the help of this platform and the open banking API (application programming interface) provided by the platform, Prince Bank and its customers and partners can be connected and integrated to further extend financial services to personal and business scenarios. Through mutual cooperation, the system can provide more powerful and intelligent services for the ecosystem to achieve symbiosis and co-prosperity. For example, we recently released reward points (to drive behaviour and loyalty), split bill payments (whilst “going Dutch”) and red envelopes (money gifts between customers).
What do you view as the single most significant challenge for the bank over the next 12 to 18 months, Mr. Sorachna? And how do you intend to go about meeting it?
In my view, it will be getting more customers on board, and we plan to do this by offering the right products and services that meet their needs over the coming 12 to 18 months. Additionally, we are also rolling out more digital-banking products to ramp up our customer base and increase revenue. We have just recently launched a purely digital deposit account, PRINCE eAccount. This new eAccount can be opened instantly through the PRINCE Mobile app hassle-free at no cost, and no paperwork is required. It caters to new customers who wish to open an account with Prince Bank without stepping into a branch and at any time of their convenience, and it’s also a boon for consumers’ health and safety amid the prolonged coronavirus pandemic. Social-distancing measures to safeguard against COVID-19 and the government’s protection guidelines and measures have encouraged people to go digital in every aspect of daily living, including banking services. PRINCE eAccount is an alternative financial product allowing new customers to open accounts with greater convenience and safety with Prince Bank. It enables them to conduct financial transactions and digital payments conveniently and securely, and this also helps to increase financial inclusion across the country.
It does indeed appear that you are onboarding as many people as possible under your banking umbrella, providing them with the products and services they need most. Thank you again for your time today, gentlemen.