At the award signing ceremony (from left): CTOS chief executive officer Eric Chin, CTOS Group CEO Erick Hamburger, Alliance Bank Group CEO Kellee Kam and Group chief consumer banking Gan Pai Li.
KUALA LUMPUR: CTOS Digital Bhd
’s wholly-owned subsidiary, CTOS Data Systems Sdn Bhd, has secured a five-year contract worth RM14mil from Alliance Bank Malaysia Bhd to enhance the lender’s loan processes and transform credit decision-making.
The collaboration will focus on upgrading the bank’s retail loan origination system (RLOS) with the credit transformation project, resulting in increased efficiency in credit assessment and loan approval processes, according to Alliance Bank group chief executive officer Kellee Kam.
Through this partnership, the bank planned to grow its retail consumer loan book by 1.5 times to RM36bil from the current level of RM24bil over the next five years.
“However, at the base of it, it is really all about enhancing the customer experience,” Kellee told a press conference after the signing ceremony.
He pointed out that the initiative would not only improve the credit score of its existing customer base but also customers who should have been “bankable”.
The project would allow the bank to evaluate the “unbanked” and “underbanked” segments comprising consumers whose traditional credit history is so limited that they do not have credit scores and easy access to credit.
On this note, CTOS chief executive officer Eric Chin pointed to an industry finding which estimated that 55% of the country’s 23 million adult population is unbanked or underbanked.
“This is the potential untapped market that Alliance Bank can explore.
“Hence, we will leverage alternative data and scoring methods to identify creditworthy individuals in the unbanked and underbanked segment,” he explained.
Meanwhile, Alliance Bank group chief consumer banking officer Gan Pai Li emphasised that the RLOS platform would not only serve as a repository for all of the bank’s consumer credit products but would also address its ability to accommodate a growing customer base.
“RLOS is the single one-stop platform that will house our mortgage and unsecured loans,” she said.
With RLOS, Gan said the bank would be able to cater to a bigger volume of customers with a shorter turnaround time.
“Today, a mortgage loan could take up to five days.
“However, with the new system, we’re trying to cut down the processing time to two days or less,” Gan said.
On unsecured loans such as personal and study loans, Gan explained that the bank’s objective is to complete the process within an hour.
“This means that if you apply for such a loan and meet all the credit criteria, the bank can disburse the money to you within the hour,” she explained.
CTOS group chief executive officer Erick Hamburger said the contract involved digital innovation and automation to enhance existing processes and to transform the credit decision-process as part of its implementation.
“Extensive data analytics and cutting-edge solutions will enable the group to provide added value to clients by accelerating growth, enhancing and expanding the decision-making capabilities,” he said.
The new loan origination system will be built on a platform from Juris Technologies Sdn Bhd, the financial technology company that CTOS acquired a 49% stake in, with the project scheduled to be completed in two years.
