BlogsResponses by Majdi AL-Beit Shawish, CEO at SEDCO for Middle East Economy
Are self-service kiosks, for banks or other institutions, essentially an extension of these institutions? What is the algorithm that is agreed upon with these institutions that allow the services you are offering, be it credit/debit cards, drivers’ licenses, loyalty cards, etc?
The pandemic accelerated digital transformation and put pressure on all organizations to minimize their operating expenses. They built digital channels like mobile applications and enhanced their online presence and services. But many services like cheque deposits or card renewal, require physical interaction. This is where self-service kiosks come in.
The algorithm depends on the demographic of end-users- their affluence and the market. Self-service kiosks enable these banks and institutions to create a 24/7 digital corner in their traditional branch, minimizing the space, reducing branch staff, and extending the working hours of the branch. For example, if you want to renew a card, usually you have to wait for 2-3 days to get it, maybe through a courier. With kiosks, customers receive their card immediately with the printed statement, hence cutting courier costs. Even if there is no teller in the branch, a customer can still be assisted via a video agent. In the telco market, there was more demand because customers want to receive/renew their SIM cards immediately. When the branches were closed during the pandemic, self-service kiosks proved highly useful to customers.
In GCC countries, the demand for digital branch transformation of government services has increased greatly. This is a trend that the UAE is leading in. For example, the UAE Digital Government Strategy 2025 aims for the government to be digital by design and that all capacities, structures, and opportunities are integrated on a national level and aligned with the UAE’s strategic digital government vision. In healthcare, self-service is popular for a seamless patient experience.
We work all over the Middle East, Africa, Europe and CIS countries and each market is different. There are leading technological markets like the UAE and lagging markets elsewhere for even basic services.
How does KYC happen over a visit to a kiosk? Does the kiosk check for credit, criminal or financial fraud history?
It depends upon the systems available in the country. If there is a bureau in the country that has these credit ratings, we can be integrated with that. For example, the ID cards in several Gulf countries have biometric identification embedded into the ID. We can validate that immediately by integrating with the backend system of the Ministry of Interior of that country. We have an AI engine that compares your photo ID with the camera in the kiosk in real-time and if there is a suspicion of a non-match, then a call goes to a remote agent to verify this immediately.
Regarding fraud, it depends on the countries and the APIs available. We integrate with the banks/telcos’ backend systems. Our kiosks can immediately identify the person within the banking system so we can deny their request, identify the fraud etc.
Which aspects (service, transactions, credit) of a bank (or other sectors) are you replacing? What aspects do kiosks not replace?
For customers, the services are delivered promptly 24/7 replacing long waiting hours. SEDCO kiosks are a one-stop shop immediately providing all required services 24/7 in carefully selected locations.
For businesses, they will need fewer branches. The staff is better utilized and managed, and they can analyze real-time data collected from our kiosks to redesign the customer flow.
It will also increase revenue. Once you have this platform of service delivery 24/7, you can innovate with third-party services. Telcos and banks have the opportunity to add more revenue through value-added services, where the customers will enjoy a one-stop-shop, which will bring them additional transaction fees.
Certain activities have to be done in person, like signing documents or cheque deposits, which cannot be accomplished via digital channels but are possible with kiosks.
A branch that has a high footfall can have a digital corner to route people there. Based on the service required, they get a queue number for the machine instead of the teller, who is more of an advisor and this is how we change the customers’ behavior.
What we cannot replace are some of the legal formalities. Legal systems have not coped with the high pace of digital transformation. Sometimes customers have to sign a document, for example, which isn’t possible without a witness, so the industry will take a few years to catch up.
What are the key benefits that banks or others can get from installing a self-service kiosk (things like time, cost, customer data/analysis….)?
One of our telco operators received its ROI in three weeks. This is because they provided third-party services that generate a consistent revenue stream for them. It differs from location to location and market to market. There are several variable factors involved, like the cost of real estate, employment, and the organization's operations itself. Usually, ROI can be expected within a maximum of around 14 months.
The technology also enhances the customer experience while cutting costs, which has an indirect impact on the revenue. For example, if a bank has 100,000 customer renewals for credit cards annually and each card costs $4-5 to courier, that's half a million dollars. These kiosks cut down the cost significantly and ROI is guaranteed.
It's more to the customer's convenience if a bank’s services can be used 24/7. When integrating third-party services with kiosks, companies can create a consistent revenue stream as well, they can bundle or package their services with other services that offer value while making a commission on the same.
How much do these kiosks cost to install, maintain, and service for banks? Is this where the main revenues come from?
It is a fraction of the cost of a human teller. It depends upon the configuration. It could range from a simple kiosk of $2000 to a very complex kiosk that can provide a ‘bank-in-a-box’ from $25,000, plus around 8-10% of this annually for maintenance.
What is the strategy going forward with banks going virtual? Do you have a role/place in a neo-banking future? In open banking and API platforms?
We've seen a few types of digital banks - those that are purely digital, those that have no or few branches in each city but want more coverage through self-service kiosks. These are some of our target markets because customers will have physical transactions, which cannot be dealt with physically and we can provide these immediately through our kiosks.
Going digital all the way is not possible right now due to different age demographics. The older generation prefers in-person interactions, with cards and cash. But the future is inevitable, and as the current generation grows stronger financially, digitalization will become rampant.
What is your role with fintech — how do you acclimatize to additions to financial services that take place over the course of a year? Is the software updated remotely? Is the kiosk limited to the services it currently offers?
Studying customer behavior is very important. Just implementing a digital solution will not make customers use it. Listening to the customer’s needs and making well thought out decisions tailored to the target market is the only way to ensure the success of digital and self-service channels.
A lot of banks and tech operators are shifting to fintech and providing third-party services like a service aggregator or a brokerage. They can consult with us on the best plan for their requirement.
SEDCO has a full kiosk online management solution for all the kiosks from the component to the application level. So, we can update the kiosk or a part of the kiosk and manage and monitor any major problems through central software.
How did SEDCO navigate through the pandemic and what makes the company’s solutions different?
We grew through the pandemic as there was a demand for self-service and healthcare. We grew by 15% in the past three years because of the huge demand for self-service, especially in telco. I see more implementation of smart kiosks in banks as well. We are a total-solution provider for smart branches and we ensure the utilization of the technology, through our smart queuing management module, by routing customers towards the digital corner, based on the transaction requested, integrated with a digital signage system, customer feedback, and mobile app, providing, therefore, comprehensive personalized journey management, and collecting data across all touchpoints into a data mining system, with business insights for planning and reporting.