Growing up in Muar, Johor, trips to the town to purchase essential goods were always a treat. Invariably, this would include a visit to a well-known bank where my parents would deposit and withdraw money with their trusty dog-eared bank books.

As much as I was in awe of the establishment’s majestic white columns, high ceilings and brass-coloured vertical bars adorning the bank tellers’ counters, the one thing that remains etched in my memory are the relationships the managers and tellers had with simple folks like my parents.

Every time we stepped foot in the bank, the same scene would play like a record.

This would typically involve the entrance of an elderly man dressed in no more than a tattered Pagoda singlet, shorts and well-worn Fung Keong flip flops, whose presence would have the branch manager himself coming to greet him by name and escort him to a bank teller, who would be just as familiar with the elderly uncle too.

And surprise, surprise, bundles of cash are come out of his pockets and are deposited on most occasions.

This intimate relationship between banks and its customers meant each customer was known by name, their worth appreciated, and financial needs understood so that the services and products delivered to them added value to their lives.

Yet, as banks grew bigger and occupied the skyscrapers in our towns and cities, the gap between them and their customers also grew larger.

Ticket machines took the place of the friendly tellers and their offerings were organised into neat categories, leaving behind those who did not correspond to their cookie-cutter services.

This was among the multiple processes and streamlined products which left banks in the tight position of being unable to meet the more unique communities in society.

Our unbanked segment makes up 8%, or roughly 2.6 million Malaysians – most of whom are women, youth, individuals from low-income backgrounds and our Malaysians in rural areas – and this is the segment that needs financial accessibility the most.

Plight of the unbanked

Something as simple as opening a banking account would potentially enable whole communities to lift themselves out of poverty.

Opening a bank account is the first step towards broader financial inclusion as it creates credit history and unlocks access to other essential financial tools.

With an account, these unbanked Malaysians can begin to obtain credit and insurance to start and expand their businesses, invest in their education and health, manage risk and weather financial shocks.

While these benefits are often taken for granted by those of us with ready access to financial services, their absence is a bleak reality for our unbanked segments.

Lacking a bank account often forces users to resort to risky measures, such as keeping their money at home or borrowing from unlicensed and high interest sources, making it harder to build up reserves, use credit, insurance and other beneficial financial tools.

Women and single mothers, notably those living in rural and remote locations with low forms of income, are faced with an uphill battle to provide, much less plan for the future of their families.

Digital becomes personal

This is where digital banking comes in. We have progressed so much as a nation, and it is high time we leverage technology to rebuild the personal banking relationships we once had, but on a greater scale.

Through digital banking, we will be able to provide opportunities to equally serve the unbanked and also be a step closer to our goals of building a digital economy and realising Malaysia’s 2030 vision of Shared Prosperity.

The country has made significant strides to connect its people to digital banking and shaping the nation to be a cashless society through the introduction of inclusive strategies.

This includes Bank Negara Malaysia’s financial inclusion framework, the MyDigital framework and most recently the 12th Malaysia Plan with a specific focus on the development of the underserved. It is time that we close the bank-customer relationship gap by relooking at the way we bank.

Building relationships that matter

While it is widely assumed that the introduction of technology may further lead to the loss of the human touch, it is this very platform that can bring us closer to each other and address our needs again.

Financial solutions providers should take this opportunity to leverage technology to cater to those typically overlooked by conventional banks.

Artificial Intelligence and big data analytics can be utilised to inform processes that will enable digital banks to provide services to the underserved segment, while balancing an appropriate level of risk exposure.

With the right technology architecture, digital banks can map the beneficial customer journeys of our customers, understanding their pain points and needs, and providing them the all-important access to these solutions, when they need them.

Digital Banking should seek to revive how banking used to be in our years past – personal, empathetic, and supportive. In an era where social distancing and reduced contact is a norm, technology will play a key role in reintroducing the warmth of personalised relationships.

Digital banks helm the responsibility of creating niche solutions that could not only cater to the unbanked but earn the trust of your neighbourhood mak cik to get them onboard with digital financing.

The impact from this financial inclusion will make significant strides in eradicating poverty and mainstreaming marginalised communities.

By harnessing the agility of technology, digital banks can bridge the gap and revive the warm relationships of yonder years that could bring back that toothy grin on the faces of our elderly uncles and aunties.

Let’s re-embrace them in our journey towards a more inclusive nation once more.

Ku Kok Peng is Group Chief Strategy Officer at Green Packet Bhd