Building a digital bank from scratch | Interview with Mohamed Almaraj CEO of ila Bank

Summary

The discussion centers on the launch of Ella, a digital bank initiated by Bank ABC in Bahrain, aimed at leveraging fintech opportunities. Launched after a strategic review in 2017, Ella sought to create a challenger bank tailored for millennials and Gen Z. Over its first year, the bank surpassed expectations, achieving 4.5 times its initial commercial KPIs. With a unique marketing approach, Ella resonated with a broader customer base than anticipated, maintaining a digital-only model. The team's focus on innovation and customer engagement sets the stage for regional expansion, highlighting the importance of persistence in their journey.

Takeaways

• 😀 Bank ABC launched 'ella' as a digital-only challenger bank to innovate in the fintech space and cater to the growing demand for digital banking services.
• 😀 The bank's strategic review, initiated in 2017, identified the need for a new approach to retail banking rather than just digitizing existing operations.
• 😀 A significant motivator for 'ella's' launch was the high penetration of smartphones and digital consumption among millennials and Gen Z in the Middle East.
• 😀 One of the main challenges faced during implementation was creating a believable business plan that accurately projected revenue and costs amid rapidly changing technology.
• 😀 Developing a Minimum Viable Product (MVP) that met customer expectations within budget and time constraints was crucial for the project's success.
• 😀 The team behind 'ella' was strategically built, combining internal talent from Bank ABC with external experts experienced in digital transformations.
• 😀 Since its launch, 'ella' has exceeded expectations, achieving four and a half times its initial KPIs in terms of commercial success.
• 😀 The bank successfully communicated its brand and services in a way that resonated with customers, using a marketing strategy similar to consumer goods companies rather than traditional banks.
• 😀 Customer demographics revealed a median age of 30-31 years, showing a broader acceptance of digital banking beyond just millennials.
• 😀 The journey of 'ella' emphasizes the importance of persistence, dedication, and adaptability in building a successful digital bank.

Q & A

What was the main goal behind launching Ella?

The main goal was to create a digital bank that could effectively serve the banking needs of millennials and Gen Z in the Middle East, leveraging high smartphone penetration and the region's growing demand for digital services.

What considerations did Bank ABC have when deciding to launch Ella?

Bank ABC considered the need for a disruptive entry into digital banking rather than just digitizing its existing retail operations. They conducted a strategic review that identified opportunities for a new, regional challenger bank.

What were some key challenges faced during the implementation of Ella?

Key challenges included developing a realistic business plan that accurately projected revenue and costs, creating an acceptable MVP within budget and time constraints, and assembling the right team to execute the vision.

How did Ella perform in its first year after launch?

Ella performed exceptionally well, exceeding its KPIs by 4.5 times, which indicated strong commercial success and effective market engagement.

What marketing strategies did Ella employ to attract customers?

Ella used innovative marketing strategies that resembled those of consumer goods companies, focusing on social media engagement and creating a relatable brand identity that resonated with the local population.

What demographic does Ella primarily serve, and what does this reveal about customer acceptance?

Ella serves a diverse demographic with a median age of 30-31, indicating that its customer base includes not just millennials but also individuals in their 30s and 40s, showing strong acceptance of digital banking across age groups.

How significant is the digital-only model for Ella's operations?

The digital-only model is crucial, as evidenced by only a minimal number of customers needing in-person services. This highlights a successful transition towards fully digital banking solutions.

What role did customer engagement play in Ella's success?

Customer engagement was central to Ella's success, as the bank adopted a communication style that made customers feel valued and heard, enhancing brand loyalty and trust.

What are the future plans for Ella following its initial success?

Ella plans to expand geographically and continue innovating within the fintech space, aiming to scale its operations and enhance its offerings.

What advice does the speaker give to others pursuing similar ventures?

The speaker emphasizes the importance of persistence, dedication, and not giving up on the set goals, highlighting that these qualities are essential for achieving success in the competitive financial services sector.