Interview: Bassel Gamal
In what ways will Islamic banks and their conventional counterparts continue to expand their influence over the short to medium term?
BASSEL GAMAL: Islamic banks have developed strong capabilities and capacity to structure and finance major infrastructure projects as well as to address all of the banking needs of corporates and individuals. The products and services offered by Islamic banks are on par with conventional banks, and the same is true for the level of customer service, digitalisation and competitive pricing being offered. The key message is that Islamic banks are relevant for all banking customers for whatever they need.
Looking to the future, we expect growth in Qatar to be sustained across all banking segments as major infrastructure projects continue amid preparations for the 2022 FIFA World Cup. Growth will also be supported by a number of initiatives and programmes introduced by the government and government bodies in order to support the development of the private sector, increase the role of small and medium-sized enterprises in the economy, and increase the areas in which Qatar can become self-sufficient. Likewise, private consumption is projected to grow due to the country’s increased population. As such, we expect that the local banking sector, both Islamic and conventional banks, will keep supporting the economy and register positive growth in the future.
To what extent will the merger of Barwa Bank and International Bank of Qatar (IBQ) impact the competitiveness of the sector?
GAMAL: Qatar’s economy has been growing steadily since 2017, and it has diversified significantly. Financial institutions play a key role in supporting this growth and the quality of life of citizens and residents while competing with each other. With all banks offering similar products and services, competition now entails the means of how those services are delivered, how well financial institutions know their customers in order to be able to tailor and personalise offerings, what the banks’ overall level of service and responsiveness is, and naturally the supplementary cost of services.
I have always believed that competition is beneficial not only for the end-consumers but for the industry as a whole. It leads to innovation and lower costs, and filters the market in a way that allows forward-looking players to succeed in the long run. The recent merger of Barwa Bank and IBQ is creating a larger institution, which is expected to have a positive impact on the banking sector as a whole.
How can financial technology (fintech) companies collaborate with the local banking sector to improve services and convenience?
GAMAL: Our customers are seeking personalised and convenient banking experiences. The fewer steps it takes to complete a banking transaction, the better. They are aware of the possibilities afforded by modern technology through daily experiences with companies such as Amazon and Uber, and they are expecting a similar level of service and convenience from their bank. Indeed, the majority of banking customers in Qatar say that they are willing to switch to another bank for better service and convenience.
Therefore, most banks in the country are working on the delivery of new, simplified digital products and services offered primarily through mobile and internet banking. Within this context, it makes sense for banks to leverage existing fintech solutions, allowing them to accelerate their digital transformations by taking advantage of the speed, innovation and customer experience-focus those companies have to offer. On the other hand, those start-ups also require banks for their large customer bases, capital, brand recognition, and understanding of compliance and regulations within a highly regulated industry.
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