Randa Bdeir has spearheaded innovation at three key banks in Lebanon since the early 1990s. The mother of four began working as a researcher on credit card payments at Banque du Liban (BDL), Lebanon’s central bank, and quickly became one of the few women in a managerial position in the banking sector at that time. As Credit Libanais’ new head of Electronic Payment Solutions and Cards Technology, Bdeir sat down with Executive to reveal her vision for how the banking sector can progress forward and share her experiences in the industry.
E How has banking changed since you started in the industry?
Banks are facing a lot of competition from outside, with [entities] like Apple Pay and Google Pay trying to take business away. These challenges should be taken into consideration because the demographics of our potential clients is changing. Now, our new clients are millennials, [many of them] are launching startups, whereas before it was only [traditional] businessmen. Because of these changing demographics, and technological innovation, banks have to react and reinvent themselves. We cannot work the same way as before—we have to look into new opportunities and client needs, and try to help them and finance them.
E How are their needs different from those of their parents and grandparents?
They are very different. Before, when [banks] used to lend to a company, we studied its activity, financials, clients, and cashflow, in order to lend to it. When we look at a startup, it doesn’t have cashflow, robust financials, or history. [A startup] has an idea and [investing in] that idea is a little risky. At the same time, it’s been proven around the world that sometimes [startups can be] very successful. Maybe the bank should have an internal unit that deals with startups, like a VC, in order to help those [entrepreneurs]. Later, when they become a regular company, they will become a regular client of the bank. We should accompany those people in their journey from early stages until they exit because there will be a point where the bank will benefit, and it will be a win-win relationship. It’s very important for a bank to reinvent itself, changing their target segment and trying to cater to a new kind of client.
E What is the importance of digitization in the banking sector?
They should work on creating new products in order to have better access to the consumer. We want to make the bank safer and more efficient—safer because, as long as digitization is increasing, the need for security is increasing. If you want to digitize, you have to have very strong [cyber]security.
E What kinds of new technologies are banks using today?
There is a lot of new technology that banks have to take into consideration. First of all, [there’s] the cloud platform. Before, it was unacceptable that anything not be done on the bank’s platform and closed and secured, but not anymore. Now they put the platform on the cloud in a secure way, and all the information is there. This helps banks to move very quickly and change and be agile. Agility is one of the main things that we need to speak about in this age. The most important thing is to make products that answer client needs, and their needs change by the minute, and [everyone has different needs]. The bank has to create an infrastructure [that allows it to be] agile—this, you cannot do internally. You cannot answer every need through a system—buy it, implement it, make it secure—[because] that takes ages. So now everything is created on the cloud [space] of big companies, with security and capacity, [rented] to banks. When a bank wants to create products that answer the evolving needs of the clients, they can [quickly] change—it’s much easier.
Another technology that’s very important is analytics. In order to understand the needs of clients, banks have to have a lot of analytics that look into credit card figures. They can see that you buy from Chanel or Zara, and they know your lifestyle. Some people [use cards to] bet at casinos, or most of their expenditure is at restaurants, or hotels for frequent fliers. We need these analytics to analyze the behavior of the customer in order to prepare ourselves as a bank with the products that are in need in the market. Another technology is Big Data. Also, there is a lot of robotics, automation of processes. We put them in place in order to strengthen control [and reduce] human error. [For example] when a card is used in Paris, and at the same time in another place within less than four hours, it will automatically alert [the bank], [because] one of them is fraud. All this technology is needed in order for the banks to be agile, to better access the life of the customer and serve the customer.
We are also moving into self service. [By] having a mobile app in the hands of the client, we give them some mechanism to [have control]. [You can specify that cards stored on your mobile] can’t be used in casinos, or at ATMs—if you know you don’t use them there. If your card is stolen, you don’t have to call [a call center] to stop the card. You can just go to your mobile app and refuse authorization in one minute. These apps are available in the market, and each bank is doing their own. What I’m trying to say is the bank [cannot be] rigid. It should follow you and your needs. While you travel, if [your cards] are lost or stolen, you wouldn’t want to call Lebanon only to find that somebody is sleeping and doesn’t answer. This is all [happening] through digitization.
Something else, we should always be very transparent with clients, and tell them everything in order to give them the [power] to decide. [We] let the clients determine their own needs, and we are open and clear about everything. Digitization enhances the customer experience. Building an agile platform is a must for [any] bank to be able to answer the needs of customer and smoothen their experience.
My message is that banks have a changing environment and [market] segment. They have to reinvent [themselves] through digitization in order to smoothen the customer experience and enhance it, and at the same time, they have to build a technology platform [that enables them] to be agile and work quickly to answer client needs.
E All this technology is a large investment of time and money for banks and sometimes payment technologies that look promising end up failing. How can banks ensure their investments are worthwhile?
We are moving from one era to another. Before, it was the industrial revolution, now it’s the tech revolution. To move between eras we have to pass through a period where [some things] don’t work, it’s tough. That’s why cloud platforms are good, and also software as a service (SaaS). Now banks are able to try software with another company and give it to the client and monitor. When everything is [successful], then they can buy the system, or [continue using] SaaS. By using SaaS and cloud, it’s less of an investment for the banks, and it [gives them] agility.
But here comes the challenge: regulators. The good thing about Lebanon’s central bank is that they’re trying to be agile and are quite progressive. There is some technology that can’t be used [in Lebanon]. Apple Pay and Google Pay [doesn’t work here] because these companies [haven’t decided to enter] Lebanon.
E If there is a new technology that exists somewhere in the world, and a bank wants to use it, what is the procedure to bring it here?
I was the one who introduced credit cards to Lebanon and [many] innovations were done by me. At Fransabank, Audi, and now [at Credit Libanais]. What I used to do when there was a new technology, I would go to Mastercard or Visa and ask them to do a pilot for me. With their help, we would create a pilot and [get it to] work, and the central bank would come and say ‘What are you doing,’ and BDL would [then] deal with Mastercard or Visa.
E Going back to your life story, as a woman at the forefront of banking, did you find it difficult back when you started? Was it difficult also raising a family?
At the time there were women working in banking, but not in managerial positions and not in innovation and new technology. [As for working and raising a family] I had someone at home to help me. But I believe that women are multitaskers. I used to [have] help, but I had four children. I was a role model for them. There are a lot of challenges to be a working mother, but they should be multitaskers to manage themselves. I used to manage myself. Other women in my society didn’t work, and the people around me thought I was crazy or unusual. They questioned why I was doing this to myself, but at the same time they looked up to me. As for the men around me, I’m known in the market [as] tough. That’s why they respect me now. At the time I started I used to go to merchants and tell them I want to put an electronic machine to accept cards, but they used to be happy to see a girl [and ask me questions] and [did] not take me seriously. Now they take me very seriously.
E What do you think of the current state of working women in Lebanon?
Because I believe in women, and I believe in a support system for women, I launched the Randa Bdeir Award at AUB. It is given every year to a person who supports a woman to achieve—not for women who achieve, but for those who support them. I don’t think there is a support system for women [in Lebanon]. They are ok with women [working], but when a woman begins to achieve, there’s a glass ceiling. You don’t see any CEOs of banks that are women. This year, they began with [more women-led] ministries, [and other politicians]. Half [of Lebanon’s] ministers should be women, because women are efficient. Women could clean out our government [from corruption]. It is beginning.