RHB Bank targets 11% growth in retail loans this year

The loan target is needed to meet the objectives laid out in FIT22, says Nazri

by MARK RAO / TMR file pix

RHB Bank Bhd aims to secure an 11% increase in retail loans this year as part of the group’s strategy to expand its retail portfolio by 2022.

Acting head of retail banking Nazri Othman said the loan expectation was an “aggressive” target for the bank when compared to the 8.7% retail loan growth achieved in 2017, but was needed to meet the objectives laid out by its FIT22 or five-year strategy.

“We need to ensure what we do augurs well and fits nicely with the FIT22 objective,” Nazri told reporters at a ceremony in Kuala Lumpur last Friday.

“One of the objectives under the five-year strategy is to increase the retail portfolio within the bank.”

The group’s total retail asset size was at RM76 billion, or about 46% of its total loan base in 2017.

Under the FIT22 initiative, RHB is predicting its retail and small and medium enterprise (SME) business segment to make up 75% of its domestic loan portfolio in 2022 from the present 69%.

Nazri said the banking group — the fourth-largest lender in Malaysia on asset base — will look to mortgages, personal loans, unit trust financing and credit cards to achieve its retail loan growth target this year.

RHB’s collaboration with financial planner RinggitPlus. com for the newly launched ChatBot digital credit card application service is part of these efforts.

The RHB RinggitPlus Xpress Apply is a real-time messenger-style platform accessible via the RinggitPlus.com website and allows for customers to complete credit card applications as quickly as five minutes.

“Through this artificial intelligence (AI)-powered ChatBot, customers can enjoy a simple, fast and seamless credit card application experience that resonates with their lifestyles,” Nazri said at the same event.

RHB is aiming to issue up to 7,000 credit cards via this platform, which would make up about 5% of the total credit cards expected to be issued by the banking group this year.

“In subsequent years, when the market is more exposed to ChatBot and also when customers are more ready to utilise this kind of digital experience, we anticipate that the number will be a lot higher,” Nazri said.

The credit card business comprises approximately 10% of total retail revenue for the group. RHB’s group retail banking business brought in RM2.48 billion in revenue last year.

RHB and RinggitPlus previously teamed up in September last year to launch South-East Asia’s first online personal loan application processing via the same ChatBot technology.

As of March 20 this year, RHB had disbursed RM24 million personal loans via ChatBot since its launch, representing approximately 95% of all issued personal loans by the bank over this period.

Meanwhile, RinggitPlus group CEO Siew Yuen Tuck said the core of the ChatBot technology is its ability to enable consumers to get their products anytime and anywhere.

“One of the keys of learning from our partnership with RHB is how much consumers appreciate speed and convenience,” Siew who was present at the same event said.

“One of the most valuable parts of having that AIpowered ChatBot is being able to respond to consumers anywhere and anytime.”

For the ChatBot credit card application platform, Nazri said all steps were taken to comply with the Personal Data Protection Act 2010.

“Rigorous tests were done and we consulted with our internal operational risk team to ensure that customer data is protected and is safe, while complying with the requirements set out by regulators.”

The platform is available for all RHB credit cards and requires between three to four days to process the received applications. Once completed, the physical cards can be collected at any RHB branch.