Sumitomo Mitsui Banking Corp (SMBC) has always been a forerunner in the industry when it comes to digital services, with its firm belief in technology and digitalisation as an integral instrument in enabling its stakeholders to lead with more efficient banking, inclusive access and sustainable lives.

The Covid-19 pandemic has shown the world the importance of digitalisation, and several companies in various sectors have scrambled to get on board the digital bandwagon in order to stay relevant. SMBC, which already has a corporate digitalisation masterplan, decided to bring forward some of its plans and ramped up on its innovation efforts during this period, to take care of its stakeholders.

Nagatomo Masayuki, head of Asia Innovation Centre at SMBC, says: “Amid the pandemic, a key thing for us is to catalyse some of the initiatives that we already had planned, which ultimately aims to get both our customers and ourselves to forge ahead in this digital world and enrich lives, so that no one gets left behind.”

Main image (from left): Yamazaki Shinichiro, global head of trade innovation & Asia Pacific head of trade finance; Lay-Ling Koh, general manager, co-head of transaction banking, Asia; and Nagatomo Masayuki, head of Asia Innovation Centre, at SMBC

SMBC’s digitalisation plans have always been in its books. But Nagatomo notes that the pandemic did place the spotlight on two key points that accelerated the organisation’s digitalisation efforts. First, SMBC recognised the need to stay agile in catering to their clients’ needs. With that comes the second point — greater flexibility, to adapt to constantly evolving situations, as unprecedented times calls for unprecedented measures.

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“We understand the importance of re-inventing ourselves and adapting to the changing environment, so that we can best support our customers to stay focused, adept and resilient in both their corporate and retail businesses,” says Nagatomo.

“The current challenging times have only spurred us to continue doing what we are doing, but at a much faster pace. We are not just a bank; we consider ourselves to be a financial platform company dedicated to not only meeting, but hopefully exceeding our customers’ expectations in achieving successes with them,” he adds.

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Smooth sailing across borders

SMBC was one of the early adopter financial institutions to promote digital solutions to service the trade finance needs of its clients.

“The trade finance business is highly complex and heavily paper-based. Once we digitalise this process, we can enjoy faster and more efficient processes. By using digitised data, we can process the data easily using technology, which will bring greater efficiency and minimise human errors,” says Yamazaki Shinichiro, global head of trade innovation & Asia Pacific head of trade finance, SMBC.

With technology and digital products now so readily available, it is not so much a matter of “why” companies should embrace digitalisation, but “when”. The faster these heavily paper-based processes are ported to the digital platforms, the earlier the benefits can be reaped, and the best resources can be directed to better manage more strategic tasks.

Digitalising the trade finance process during the current pandemic is crucial. With unpredictable delays in logistics, as well as closed or tightened borders, companies need an avenue to keep their businesses moving forward and keep their cash flow moving too.

It is imperative that businesses keep running in order to ensure that the international supply chains remain open. “A more effective way to build resilience in a post-Covid-19 world is through diversification of supply chains, creating greater transparency in the value chain, and promoting agility,” says Lay-Ling Koh, general manager, co-head of transaction banking, Asia, SMBC, noting that digitalising trade finance is in line with the Singapore government’s efforts to keep supply chains open.

SMBC announced on Oct 23 that it is among the initial first banks in Singapore to support the adoption of and transition to the Networked Trade Platform (NTP), a one-stop trade portal for companies based in the republic, led by the Singapore government through public-private collaboration. SMBC is also a participating bank of the Electronic Banker’s Guarantee Programme managed by Singapore Customs, and will provide online trade finance services on the NTP’s Trade Finance Application Portal (TFAP).

“The digitalisation of trade platforms brings about enhanced control and efficiency. At the end of the day, trade is the lifeline of businesses. With our products, we look to help our customers better analyse and forecast their positions from a trade flow perspective, as well as improve their cash flow positions, which is extra important for many businesses now,” says Yamazaki.

Trusted matchmaker

During such challenging times, people need to come together and help one another. Consolidation of efforts is key.

This is where SMBC’s online business matching service, Biz-Create, shines. First launched in Japan in May 2019, it is the first business matching platform launched by any bank, where the bank’s clients can freely match with each other to maximise business opportunities and growth. This platform is a joint project by SMBC and NEC Corp to give companies a safe and low-risk platform to find other firms with complementing interests.

The platform is built with a robust security, equivalent to a banking system, thus giving customers the assurance that their business and personal information continue to be safeguarded and kept private.

In Japan, and also in many Asian markets, it is common for companies to prefer face-to-face meetings, thus requiring staff to travel to offices in other prefectures for meetings. But the pandemic has put a damper on such practices, creating the opportunity to demonstrate how digitalising these meetings can help businesses stay relevant and save time while expanding.

Biz-Create has therefore been positioned as an online version of the face-to-face business matching service that SMBC had been offering. It has an easy-to-understand user interface and various support functions, to keep communication barriers low even for the less digital-savvy clients.

Nagamoto says: “Trying to find business clients and partners is a difficult task, whether domestically or internationally, because without the traditional face-to-face interaction, business relationships and trust are harder to build. However, Biz-Create helps to overcome these challenges and makes it easier for businesses to continue to operate and grow.”

As the companies in this platform are SMBC’s valued clients, they can be rest assured that all companies on the platform have gone through SMBC’s strict stamp of approval and are vouched for in terms of corporate reliability.

“We have been very comfortable with the bank-sponsored services as they ensure a sense of safety and security,” says bellFace, a development and marketing company for online business operations systems and one of SMBC’s clients that has tapped Biz-Create to reach a wide range of new customers and benefitted in terms of time savings by discussing dealings online before arranging physical meet-ups to finalise the deals. Through the system, bellFace has received over 120 inquiries for its posted system in just two months. It also saw a success rate of over 90% in securing deals, with over 100 inquiries concluded with actual deals.

Empowering communities

SMBC has an increasing presence in Asia, where 16 of its network offices span across 40 countries and regions globally. In Indonesia, SMBC owns 92.43%of PT Bank BTPN Tbk (Bank BTPN). Although SMBC mostly operates as a corporate bank in countries outside of Japan, it operates a retail bank in Indonesia with Bank BTPN to serve the large unbanked community.

According to a 2019 report by Google, Temasek and Bain & Co, Indonesia has around 47 million underbanked and 92 million unbanked adults. This translates to a huge growth opportunity for SMBC to tap into.

Bank BTPN has already started its own digital bank, Jenius, in Indonesia and is focused on growing its presence there. With the surging growth in internet penetration and mobile phone adoption, Jenius has reached out to over three million Indonesians today, bringing them banking services and tools in a single mobile phone application.

“Jenius aims to be part of the digital lifestyle of the consumer, to serve as an enabler for their day-to-day tasks to be done more efficiently, starting with the basics of performing banking transactions remotely, and then going beyond. At first, Jenius started only providing regular banking services, but this has since evolved, as it now can be used for contactless and cashless payments, to secure loans and even for personal financial management. This is just the tip of the iceberg and we have more to look forward to,” says Nagatomo.

Jenius also pushes simple but essential application features to support and be relevant to the changing needs of its consumers during the pandemic, such as Jenius QR for contactless transactions, and Moneytory for better cash flow organisation, as consumers bank from home. Jenius aims to significantly empower and change the lives of millions of people in Indonesia, mainly with the support of digital technology, by enabling customers to enjoy greater efficient banking services right on their smartphones; have more inclusive access with a user-friendly platform that can be used by anyone and everyone remotely; and to enjoy a more sustainable life, by enabling financial planning (both personal and business) to be done in one simple application.

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A better tomorrow, together

It may seem that SMBC has achieved a lot in its digitalisation journey, but this is only the first of many efforts for the bank as it has more plans in store for the future.

Koh shares that SMBC will continue to invest in people and digital tools to allow its clients to gain better insights into their businesses. The next step for SMBC will be to harness data to help its clients transform their businesses so they can stay ahead of the curve.

“We want to work hand-in-hand with our clients like business partners, rather than just being a bricks-andmortar bank and just giving out loans,” Nagatomo says, adding that SMBC’s main goal is to create a sustainable future for its stakeholders and the next generation.

The bank also aims to leverage on cross-border collaboration and complementing capabilities from strategic partnerships and investments to meet its innovation goals. For instance, SMBC Group recently entered into a comprehensive partnership with SBI Holdings, with a JPY100 billion fund set-up to identify, collaborate with, and support forward-thinking FinTech companies to bring banking capabilities forward.

Nagatomo says: “In order to implement our digitalisation initiatives in a speedy and efficient manner, we at SMBC will continue to engage in open innovation that brings together the data, technology, and expertise of not only SMBC Group companies, but also of partner companies, which include start-ups, and our customers.

“We will create high-quality, appealing services by focusing equally on accelerating the reinvention of SMBC Group’s business culture, for example, marketing style and the workstyle of head office employees, and pursuing new opportunities. All of our customers will be offered these services, regardless of whether they are wholesale or retail customers.”

Find out more about SMBC’s digitalisation initiatives and hear from Rajeev Kannan, managing executive officer, deputy head of Asia Pacific division, at the 2020 Singapore Fintech Festival as his panel discusses the intricacies on long-term investment in renewables for infrastructure.

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