Asanka Ranhotty, Senior Vice President of SME & Transaction Banking at Union Bank, provides valuable insights into the bank’s innovative cash management platform, Union Bank BizDirect. He is joined by representatives from two long-standing clients, Ruwan Rodrigo, Vice President of Finance at Union Assurance PLC, and Dhanushki Jinadasa, Chief Financial Officer at Trinity Steel. Together, they delve into the transformative impact of Union Bank BizDirect.
Union Bank was among the pioneers in introducing a cash management solution. Could you provide insights into how this initiative originated and the factors that led to its development?
Asanka: Union Bank led the way in 2014 by launching Union Bank BizDirect, the first comprehensive cash management solution introduced by a local commercial bank. Before this, only four foreign banks offered similar solutions, primarily catering to multinationals and a few large local corporates. Union Bank BizDirect revolutionized the market by extending cash management solutions to local corporates and SMEs.
Initially, the connectivity was web-based, later transitioning to host-to-host integration with ERP solutions. In 2020, the system underwent significant upgrades, now featuring API connectivity and robust multi-factor authentication security, including mobile authorization. This ensures secure approval processes, particularly beneficial to companies with globally dispersed directors. Union Bank BizDirect has evolved into a mature product, comparable to offerings from foreign banks, affirming Union Bank’s commitment to delivering cutting-edge cash management solutions.
And where do you see it going forward?
Asanka: Many businesses in Sri Lanka are still grappling with the concept of cash management. It’s essentially an end-to-end solution that encompasses the entire cash conversion cycle. This includes streamlining collections, payments, reporting, liquidity management, and reconciliations. By automating these processes, businesses can achieve higher efficiencies, allowing management and employees to focus on core activities.
For SMEs, maintaining records and understanding the financial landscape can be challenging. Union Bank BizDirect provides control over collections and payments, offering SME owners and managers the opportunity to streamline operations and dedicate more time to business growth. Automating payments can further enhance efficiency and productivity.
When evaluating Union Bank BizDirect’s effectiveness and benefits, what do you consider the main factors enabling success in the competitive cash management industry?
Asanka: Union Bank BizDirect is exceptionally competitive and comprehensive, catering to businesses of all sizes, from SMEs to large multinational corporations. It empowers businesses to manage collections, payments, liquidity, reporting, and reconciliation seamlessly and securely. One of its greatest strengths is its ability to integrate with any accounting software or ERP platform seamlessly. Moreover, Union Bank BizDirect can be customized to meet the specific needs of any business, making it a versatile and indispensable tool for financial management.
In today’s tech-driven world, customer expectations are soaring. How has each of your organizations leveraged technology like Union Bank BizDirect to meet and exceed these expectations?
Ruwan Rodrigo – Vice President – Finance of Union Assurance PLC
Ruwan: Across the insurance industry, technology has been instrumental in driving business evolution and enhancing customer convenience. Over the past decade, the insurance industry has undergone a significant transformation, shifting from manual processes to fully digital platforms. Union Assurance has maintained a competitive edge by leveraging technology effectively. For instance, we were the first in the industry to achieve 100% digital submissions and expedite policy issuance, surpassing global standards.
Additionally, we lead in introducing digital medical reports and electronic medical examination reports, streamlining policy issuance like never before. Despite the insurance industry’s slow progress towards full online adoption, recent years have seen a doubling of digital applications, especially due to the pandemic. In response, Union Assurance has launched several online products as part of our long-term strategy.
We have integrated fitness tracking and telemedicine into our customer service platform, incentivizing good health outcomes. Our dedicated customer service app further enhances accessibility and engagement. Moreover, our partnership with Union Bank’s BizDirect system ensures that over 90% of our claims are paid within a day, prioritizing customer needs during critical moments.
Dhanushki Jinadasa – Chief Financial Officer of Trinity Steel
Dhanushki: Trinity Steel, a manufacturing and exporting company, has witnessed a significant transformation in customer engagement and operations. Previously, acquiring customers involved costly procedures like visits and faxes. However, technological advancements have enhanced manufacturing efficiencies and communication with customers.
Today, communication is seamless through various platforms like WhatsApp and Viber, eliminating the need for physical visits. As exporters, we prioritize customer satisfaction and offer services like shipment tracking via our website. This transparency is particularly valuable to customers shipping goods internationally, as it provides real-time visibility into the shipment process. With our global market reach, such visibility builds trust and fosters strong customer relationships.
How has Union Bank’s BizDirect helped you in your expansion plans?
Ruwan: At Union Assurance, our growth outpacing the industry is attributed to three key factors. Firstly, we adapt our value proposition to meet customer needs, aligning our business with market dynamics and preferences. Secondly, we adjust our strategy to match the country’s transformation journey. Thirdly, we invest significantly in people, systems, and governance to support our growth. Union Bank plays a crucial role in our operations, particularly in premium collections, claims payments, and liquidity management.
For premium collections, Union Bank collects cash from our branches, reducing cash touchpoints and associated risks. Additionally, Union Bank BizDirect facilitates efficient claims processing and reconciliation. With Union Bank BizDirect, we can track cheque realizations, respond promptly to customer queries, and access reconciliation statements swiftly. Moreover, having multiple bank accounts with Union Bank BizDirect allows us to monitor cash balances, deposits, and cheques in real-time, optimizing liquidity and working capital management.
Dhanushki: Earlier, we heavily relied on manual paperwork at Trinity Steel but today our business model necessitates online accessibility and approvals. With a significant volume of foreign currency transactions, both cross-border and domestic, manual or PDF applications are impractical. Union Bank BizDirect streamlines outbound payments, supporting transactions ranging from $500 to million-dollar sums, ensuring convenience and flexibility. We also utilize Union Bank BizDirect for local salary transfers and repatriating expat salaries in bulk, streamlining our monthly payroll processes. This systemized approach enhances efficiency and eliminates the need for individual salary transfers.
What benefits can potential clients expect from Union Bank BizDirect?
Asanka: Union Bank BizDirect offers significant benefits to customers, particularly in cash management. Effective cash management involves obtaining cash upfront and optimizing its use throughout the cash conversion cycle. Unlike Internet banking, which is different, cash management requires an automated end-to-end solution.
This solution empowers customers with full control over collections, payments, reporting, reconciliation, and liquidity management, enhancing efficiency, reducing costs, and freeing up management time for core business activities. Additionally, it improves overall business efficiency, reduces costs, enhances security in cash handling processes, and provides real-time information for quick decision-making. These benefits make cash management essential for businesses of any scale, whether multinational or SME.
CEOs often lament the plethora of tech solutions available and the common issue of inadequate support post-purchase. How does Union Bank BizDirect stand out in this regard?
Asanka: Union Bank BizDirect offers a comprehensive solution covering various payment needs, including online and printed options. Online functionalities encompass tasks like online payments, saved slips, RTGS, inter-account transfers, and handling local, foreign, salary, and statutory payments. For printed solutions, we provide on-site printing and cheque printing services, with options for courier delivery or direct distribution to designated addresses.
Additionally, we specialize in dividend management for companies listed on the Colombo Stock Exchange, ensuring adherence to strict regulatory timelines. To support our clients effectively, we have dedicated customer service and implementation teams. The customer service unit handles training, day-to-day inquiries, and feedback management, while the implementation unit focuses on onboarding and integrating with ERP solutions. Both teams work closely with clients to ensure seamless service delivery and ongoing support.
Have efforts towards digital transformation and promoting a cashless society accelerated the country’s recovery from recent challenges, and what specific contributions have your initiatives made towards this progress?
Dhanushki: Despite facing significant challenges, particularly with forex restrictions starting in 2021 and ongoing difficulties in 2022, Trinity Steel has successfully sustained and even expanded its export-oriented business. Thanks to the efficient management of systems and foreign currency procurement, the company has not only maintained operations but also experienced growth amidst a global recession.
By running operations around the clock and actively supporting local businesses through procurement and other means, Trinity Steel has played a vital role in bringing foreign currency into the country while contributing to the growth of domestic industries. Despite some necessary imports for raw materials like steel, the company prioritizes local suppliers wherever feasible to foster broader economic development.
Ruwan: Despite the country’s recent challenges and ongoing recovery phase, the insurance industry has experienced a notable increase in demand as people seek financial security amidst uncertainty. Despite the overall negative growth in the past year, the insurance sector has recorded positive growth, reflecting a growing need for assurance among individuals.
Given Sri Lanka’s low insurance penetration compared to Gross Written Premium (GWP), Union Assurance remains committed to aligning its strategies with the country’s transformation journey. The company will continue to provide essential insurance services to customers, ensuring protection for those in need during this period.
Asanka: Union Bank remains committed and steadfast in supporting our customers, whether they’re exporters, importers, or retailers, especially during challenging times like the pandemic. The importance of having a robust digital system became evident during this period, leading to increased customer onboarding as they recognized its necessity. Embracing paperless and digital practices is crucial not only to our industry but to all sectors. While Sri Lanka was ahead in this aspect compared to some Asian countries, recent years have seen others surpass us. Now, banks must catch up and prioritize digitalization to stay competitive. Thank you, and we invite you to explore our system to see its effectiveness firsthand.