the legwork in the early stages of the proj-

ect, the introduction of a full banking chan-

nel now takes just three months from start

to finish, says Vrey. New products can be

introduced ‘without excessive work or cus-

tomisation’.

This degree of efficiency is in part due

to Absa’s customer-interface which sees

cash transaction flows being replicated

across all the channels, going to a middle-

ware layer based on IBM’s Websphere. This

is directly interfaced to the bank’s ATM/POS

network platform built around ACI’s

Base24-eps.

The positive feedback from Absa’s top

management on all that has been done to

date indicates to Vrey that ‘the penny has

Crossing the divide

Absa Bank’s channel policy is to build bridges. It’s long-term and it’s led by technology, but are there any gaps?

MULTI-CHANNEL BANKINGCASE STUDY: ABSA BANK

simultaneously if necessary.

When it comes to mobile banking, Absa

was an early adopter, launching its mobile

banking offering in 2000, this being carried

on the framework of the bank’s internet

offering. The first mobile phone-based

banking service was launched in 1997 by

Merita Bank in (no surprise here) Finland.

Both services used SMS. When a decision

was made by Absa some five years after its

mobile launch to move into the Web 2.0

space, ‘it took us less than six months to

create the required interface, as we could

use a lot of the existing capability’. This suit-

ably short timeframe highlights the efficacy

of the bank’s channel policy.

Indeed, having done the research and

Absa Bank ‘is not afraid of pushing the

envelope’ when it comes to innovating,

states Christo Vrey, managing executive of

the South African bank’s digital channels

division. It’s all well and good making such

claims, but sustaining the effort beyond

a few noteworthy wins is quite another

matter.

In this respect, Absa has ensured it has

the walk to go with the talk, having imple-

mented a long-term banking channels

strategy which it adopted at the start of

this millennium and which is still in action.

From the outset, Absa – a part of Bar-

clays Group – has insisted on adopting only

those technologies that can be interfaced

and developed ‘in a way that enables the

availability of products and

services across all channels’,

states Vrey. The important

thing is that it has adhered to

this policy, even if, as he

admits, it has endured some

interesting ‘ups and downs’

on the way. ‘It’s a long jour-

ney that needs to be taken

step by step’, he says, adding

that the journey has to be

‘continuously sold to, and

communicated across, the

organisation’. But in the end,

the effort, the risk and the

sustained belief that what the

team was doing is right, has

paid off handsomely, giving

Absa a collection of integrat-

ed channels that enable its

customers to reach into the

bank – and the bank to reach

out to its customers – from a

number of different points,

© 2011 IBS Intelligence1 www.ibsintelligence.com

secure’, he says. The recipient receives an

SMS with a ten-digit code (originated by

the system) and information about the

transfer amount. The recipient then receives

another SMS (or a phone call) from the

sender with another code, this time a six-

digit one, generated by the sender. All the

recipient needs to do then is to input the

two corresponding codes and the exact

amount into any one of Absa’s domestic

ATMs and the money will be distributed

from the machine. Meanwhile, the sender

and the bank can trace the full transaction

history if any dispute arises. According to

Absa’s statistics, by mid-2011 the CashSend

service was presiding over at least 100,000

transactions per month, with the equivalent

of more than $81 million being transferred.

‘The CashSend functionality has opened up

multiple user experiences,’ states Vrey. Typi-

cal small sums such as payments to labour-

ers for services such as gardening and

housework, or parents giving money to

children can be facilitated, this making it

usable by banked and unbanked alike. In

the spirit of inclusivity, the CashSend service

has now also been extended to SMEs. Cash-

Send Plus, as it is known, enables small

business owners to pay their staff, via an

ATM, using the same principle as for retail

customers. Absa is not due to rest on this

one anytime soon: it is also pondering

international expansion, says Vrey. Whilst

the regulatory side of the cross-border ven-

ture is ‘extremely complicated and limiting’,

there are, he comments, no obstacles in

terms of technology and capability. This

comes as part of Absa’s desire to cross any

divide it meets, be it geographical, social or

technological.

really dropped’. Their continued support

certainly vindicates the channel team’s

efforts and steadfast approach. ‘A truly

multi-channel remote banking offering is

the holy grail these days and I believe Absa

has managed to achieve it over the years,’

Vrey states. ‘Any transaction that is done

via one of our four channels – online,

mobile, self-service [such as ATM, POS or

kiosk] and messaging [SMS, email and fax]

– is immediately reflected across all of

them.’

Although linked, each has carved out a

well-defined place in the Absa service set.

The messaging channel, for example, is a

‘value-added service’, which allows cus-

tomers to keep track of their banking activ-

ity in real-time. Vrey cites the bank’s ‘Notify

Me’ service as an example of what is cur-

rently provided via this channel: customers

receive emails and/or SMS updates ‘on any

activity, on any account, anywhere in the

world’ within four seconds of a transaction

taking place. The obvious security value of

this service has seen it so far reach some

7.5 million subscribers, resulting in the

bank delivering more than 100 million SMS

messages a month, he says.

Absa is a long-standing customer of

ACI Worldwide (the bank has been working

with ACI since the mid-1990s). The ven-

dor’s current Base24-eps offering supports

the bank’s ATM/POS network and Tandem

processing platform. In true ‘in-for-the-

long-haul’ Absa style, there are no plans to

move away from ACI, says Allen Mahadeo,

head of the bank’s self-service channel.

There is good reason for keeping the faith

with ACI: the volume of transactions via

self-service channels exceeds 40 million per

month which, observes Mahadeo, ‘requires

a reliable and stable platform’. In addition,

he says Absa can call upon the experience

of a well-matured dedicated in-house team

that knows the solution and the vendor

inside out.

Absa’s jewel in its ATM crown is a card-

less service dubbed CashSend. This is sup-

ported by ACI software. CashSend was

introduced in 2008 and is available across

the bank’s domestic network of around

5800 ATMs. It enables retail customers to

make low-value payments to any individual

with a mobile phone in South Africa; the

recipient does not need to be an Absa

client. The payment can be originated

online, via a mobile device or at an ATM,

and the money can be withdrawn from any

Absa machine.

The main beneficiary of this service is

the unbanked of South Africa, notes Vrey.

Around half of the country’s population of

50 million falls into this category.

The process is necessarily ‘simple and

‘A truly multi-channelremote banking offering

is the holy grail these daysand I believe Absa has

managed to achieve it overthe years.’

Christo Vrey,Absa Bank

© 2011 IBS Intelligence 2www.ibsintelligence.com

Christo Vrey,Absa Bank

MULTI-CHANNEL BANKINGCASE STUDY: ABSA BANK

Publication: IBS Journal – global independent perspectiveon financial technology. Editor: Tanya Andreasyan. Thisarticle has been extracted from the IBS Journal Decem-ber 2011 – January 2012 issue 21.4. IBS Intelligence, atrading name of IBS Publishing Ltd. Registered office: IBS Publishing Limited, 8 Stade Street, Hythe, Kent,

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