The 21st century global economy is going through an artificial intelligence (AI) revolution, where elements like machine learning, data analysis, and robotics are rapidly changing every brick-and-mortar entity. Like any other vertical, the global banking sector is also experiencing unprecedented changes, arguably the fastest in modern history.
These digital revolution-powered transformations are permanently altering the nature of traditional banking, apart from redefining the relationships between banks and their customers. As the global economy faced a screeching halt in 2020 due to the COVID-19 outbreak, all the sectors learnt this crucial tagline: either embrace technology or risk permanent shutdown, thereby recognising the importance of investing in digital services, which will in turn streamline processes and reach a broader customer base.
Since then, innovation in the digitalisation of banking has made headway, with AI pushing the transformation further. The McKinsey Global Institute estimates that the banking sector stands to benefit significantly from generative AI, which could add between $200-340 billion in value annually (equivalent to 9-15% of operating profits) through increased productivity.
Kuwait International Bank (KIB) has adapted to this new reality through its financial initiatives.
The KIB Story
In the modern era, although the global economy is rapidly deploying the “Digital First” approach, some of them are not realising the value of the importance of putting these “technical evolutions” through exhaustive trials, before inducting them to the operations.
Mohamed Elshareef, General Manager, Digital Innovation and Data Intelligence of the Kuwait International Bank, while using the CrowdStrike example (the largest IT outage in history which was triggered by a botched software update from the security vendor, affecting millions of Windows systems around the world), stated that it is crucial to emphasise the importance of the testing environment, especially because some of these solutions get entrusted with the job of managing trillions of businesses and data points in real-time.
Kuwait International Bank’s recent achievements in the digital sector can be attributed to its long-term investment strategy focused on digital infrastructure, which operates on two key fronts. The first front emphasises the development of new services, prioritising flexibility and speed in their launch while ensuring continuity and system reliability. The second front focuses on building a strong digital infrastructure, which is essential for any banking operation.
“At the heart of KIB’s investments in digital infrastructure is the KIB Digital Factory, a unique model in the local banking sector. This innovative concept not only protects, tests, and develops the bank’s digital services through collaboration with various departments, primarily cybersecurity and information technology, but also engages with customers, gathering their opinions and feedback on services,” explained Elshareef in his article for the World Finance, while adding, “this approach aims for rapid, continuous, and flexible development, which is a cornerstone of successful banking operations. Consequently, KIB has been working diligently on its innovative digital offerings. It has launched not one, not two, but three state-of-the-art digital banking platforms since 2023.”
Kuwait International Bank has completely revamped its retail app, KIB Mobile, to provide customers with an advanced banking experience. KIB Mobile now offers comprehensive access to financing details, payment schedules, account management, banking cards, and investments.
Customers can manage their financial portfolios, make faster decisions, and use quick services such as transfers, payments, and managing beneficiaries. Then we have the KIBPay service, which allows easy payment requests, account refills and bill splitting.
“What’s more, KIB introduced the WAMD service for instant payments and money transfers via the KIB Mobile app. Powered by KNET, the service allows easy and secure account-to-account transfers using a valid number, without sharing sensitive banking information,” Elshareef said.
For corporate customers, the bank has launched its corporate online banking platform designed to simplify managing employees’ banking operations and financial details. The tool allows for personalisation based on roles and responsibilities, ensuring users have access only to the tools they need.
Customers can also place and redirect requests to designated team members for streamlined processes. Key features include a tracking dashboard for monitoring bank interactions and a POS dashboard for an overview of financial operations via POS, MasterCard, Visa or KNET.
Meanwhile, real estate customers can benefit from the first-of-its-kind “KIB Aqari Platform,” offering tailored services and innovative solutions for all real estate needs. KIB Aqari features digital appraisal requests and follow-ups, QR code verification of appraisal reports, automated rent collection, and late payment tracking, adding convenience to property management.
While KIB offers SWIFT and GCC cross-border payment system (AFAQ) services to enable its customers to carry out international money transfers, the bank is also working on adding three new international transfer services to enhance customer experience by providing greater convenience, speed and security.
AI: KIB’s new buzzword
The year 2024 saw a new trend: AI aiding in everyday banking needs. There are predictive budgeting tools through which banking apps turn analysis into actionable budgeting advice and insights. KIB’s Digital Innovation and Data Intelligence Department did not miss out on this field either.
“Kuwait International Bank introduced a financial tracker tool to its retail digital app, offering customers a variety of benefits. These include a quick financial overview for instant snapshots of spending and savings, detailed expense tracking for better financial control, monthly comparison for month-on-month spending comparisons, bespoke budgeting to set and track budgets in real-time, and advanced analytics for personalised spending behaviour analysis to make informed decisions,” Elshareef noted.
The banking sector’s AI investment is expected to reach $97 billion by 2027, as mentioned by the International Monetary Fund’s Finance and Development magazine. This AI transformation will cover areas like optimising processes, boosting efficiency, and increasing productivity. AI-driven technologies are automating repetitive tasks, enhancing accuracy and accelerating processing times.
“Take KIB’s WhatsApp interactive service, for example. AI-powered chatbots are now capable of addressing customer queries with precision, personalisation, and efficiency, making KIB WhatsApp a significant enhancement to the bank’s tech-based solutions and a key part of its digital infrastructure investment journey,” Elshareef continued.
Artificial intelligence has also become crucial in the financial sector’s data analysis activities (in terms of understanding the individual customer’s financial behaviour, before offering personalised products). KIB has been among the pioneers in recognising the undeniable importance of data, along with its security, with the necessity of leveraging it to serve customers.
Kuwait International Bank is tirelessly working to safeguard its customers’ and investors’ data, as evidenced by being awarded the ISO 27001:2022 International Certificate for Information Security Management System in January 2024 for the 10th consecutive year.
A paradigm shift
“A shift in the spatial nature of banks has been another change the industry is witnessing. Today’s customers don’t feel the urge to visit the bank to conduct their financial activities, since they know they can transfer cash or open accounts, by just performing a few clicks on their smartphone apps. We have another new trend: where “Digital Only” banks are steadily making their presence felt,” Elshareef added.
Kuwait International Bank has begun launching many unique services aimed at serving customers in a new manner. In November 2023, KIB launched the interactive teller machine (ITM), combining the convenience of traditional ATM services with the personalised touch of in-person banking. This cutting-edge machine enables customers to perform a wide range of banking transactions with the assistance of a live, remote teller through high-definition video and audio communication.
During the same month, KIB reopened its head office branch after redesigning it to provide an interactive environment for customers. Equipped with the latest innovations and modern financial technology, it steers from a typical corporate and banking setting. Then in February 2024, the bank opened a new branch in Kuwait’s Sabah Al-Salem area, featuring the most advanced digital banking devices and interactive screens to cater to the customers’ needs in an innovative approach.
“With increased reliance on technology and the ease of completing most transactions without needing to set foot in a bank branch, the current trend will ultimately lead to more virtual branches. However, this is considered a long-term change in the region and is still in its early stages,” Elshareef concluded.