ABF sat down with the deputy CIO as he shared the story behind KBZPay.
Sai Lu Mon Aung is the Deputy Chief Information Officer and Head of Information Systems Division at KBZ Bank.
Joining in 2016, Lu Mon leads the digital product and development innovation at KBZ Bank, where he helped develop the technology behind KBZPay, Myanmar’s fastest-growing mobile wallet with over 6 million users.
Lu Mon also co-leads the bank’s Mesh Banking initiative—a new way of banking that brings products and services to customers faster through seamless integration of all its branches and digital channels, with KBZPay as the key connector.
In an interview with Asian Banking & Finance magazine, Lu Mon shares the story behind KBZPay, how it contributed to the financial inclusion in Myanmar, as well as the financial trends in the country.
Tell us more about KBZ Bank’s digitisation journey. How has this investment helped you during the COVID-19 pandemic?
As Myanmar’s largest privately owned bank, KBZ Bank plays a critical role in driving the success of the nation’s entrepreneurs, businesses and communities.
To achieve our goal of 100% financial inclusion in the country, we launched KBZPay in August 2018, our mobile-first approach to create both the technological infrastructure and easy-to-use interfaces that bring banking beyond our branches. What started off as a bank-led digital wallet offering users a convenient and secure way to manage their funds and purchase everyday products, soon evolved to become the go-to platform propelling Myanmar’s digital economy with financial services at its heart.
Today, KBZPay has granted many people access to financial and digital services for the first time, and connected more than 6 million people to a network of more than 290,000 merchants and agents, including: microentrepreneurs, e-commerce companies, e-gov services, educational institutions, and employers across Myanmar.
Never was the launch of a digital platform so timely and fortuitous, as KBZPay found itself at the forefront of the nation’s fight against COVID-19 a year later. With KBZPay up and running before COVID-19 hit us, we were able to continue providing essential financial services and liquidity safely and securely, in a truly digital, instantaneous, real-time, and always on manner. This ensures that businesses and households always have access to our services even whilst social-distancing.
In support with the Myanmar government’s COVID-19 Economic Response Plan (CERP), KBZPay has also stepped up to address the urgent crisis at the national level by (i) increasing the wallet balance limit for all customers; (ii) collaborating with various government departments to disburse cash to mothers for better antenatal and postnatal nutrition, and agricultural loans to farmers; and (iii) making it possible for customers to fund COVID-19-related charities and initiatives through the KBZPay platform.
As we continue on our digitisation journey, we are - with each bold step - strengthening the Myanmar of today and laying the foundations for the Myanmar of tomorrow.
Can you describe your career up to now? What important lessons have you learned in managing KBZ’s digitalisation journey?
Prior to joining KBZ Bank, I was working on Wall Street in the US, focusing on co-locating with the exchanges to reduce latency down to the nanoseconds’ range, and improving existing trading platforms’ features and transaction speed.
Meanwhile, In Myanmar, the digitalisation journey happens at a slower pace, with the transformation process involving more human interaction and customer education, especially when I first joined KBZ Bank a few years back.
As our digital banking platform garners a fast-growing user base, one important lesson I have learnt is that financial institutions must be inclusive, even as they progress on their journeys towards digitalisation and modernisation.
With digitalisation becoming an increasingly vital part of our lives today, it is important that people from all walks of life have access to safe and secure everyday services through easy-to-access financial platforms. To do so, we need to work as an industry to assure that safely-distanced financial services like digital payments are “inclusive by design”, secure, and trustworthy.
Whilst technology and innovation is pivotal to make progress, the human touch is indispensable in the transition towards a more cashless way of banking and living. Particularly, for cash-heavy countries like Myanmar, banks need to be mindful that introducing digital financial services should be done hand-in-hand with introducing the formal financial system to people, some for the first time in their lives. To achieve this, KBZ Bank mobilised our 18,000 employees as financial inclusion ambassadors to various townships.
Potentially the largest-ever digital onboarding initiative in Myanmar’s history, our colleagues introduced KBZPay mobile wallet to the people at a pace that is right for our communities, with KYC embedded in every step of the way.
What are some retail banking trends happening in Myanmar currently?
As Myanmar progresses towards a mobile-first digital economy, demand for fast and affordable transactions are on the rise. Such experiences require interoperability, a key feature of our mobile-first approach to offer better user experiences and engender growth for businesses that partner with us. Today, KBZPay users can top-up their mobile data with all of Myanmar’s telcos, purchase gaming tokens for Mobile Legends Big Bang, subscribe to their favourite tunes on Joox, book a trip home with Flymya and MMBusTicket, or make payments to offline merchants via QR code payments.
With phase 2 of the Myanmar Financial Network System (CBM-NET) underway, we expect KBZPay to eventually be able to support fund transfers between the app and other financial entities.
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