An exclusive interview with Senior Executive Vice President, Group Head of Retail Banking, Mashreq Fernando Morillo
Interview by: Zubair Qureshi Arranged by: Muhammad Asif Sheikh Photos by: Sheikh Arif
The UAE-based financial services group Mashreq has secured a digital banking licence from the State Bank of Pakistan (SBP), to commence the process of setting up a digital bank in the country, and it plans to introduce its unique and award-winning digital banking proposition ‘Mashreq Neo’ to customers in Pakistan.
The bank has established a long-term vision for its presence in Pakistan, which involves building a specialized team of bankers and engineers with multicultural experience. Senior Executive Vice President, Group Head of Retail Banking, Mashreq Fernando Morillo in an exclusive interview with Pakistan Observer shows optimism and held that the bank aimed to play an important role in the country’s financial inclusion and development, particularly in the Small & Medium Enterprises (SME), payments, and e-commerce space, with a sharp focus on empowering women and youth.
Pakistan Observer: What makes Mashreq stand out amongst all other banks that have acquired the DB license?
Fernando Morillo: Of the five successful digital bank applicants in Pakistan, Mashreq is the only one that is globally regulated and has all the flexibilities of a tech firm. Our award-winning and innovative banking propositions, such as Mashreq Neo, NeoPay, and NeoBiz, and our commitment to superior customer experience set us apart from our peers.
We believe that our products and services can be a catalyst for expediting Pakistan’s digital
transformation. Our digital banking philosophy is anchored around robust technological
infrastructure, coupled with excellence in cyber security and a prudent compliance strategy. This is based on our extensive experience in dealing with various key stakeholders, such as central banks and regulators, in the international markets where we have a footprint.
PO: Could you provide an insight into Mashreq’s digital banking expertise and focus?
Classification: Public FM: Having grown significantly in 2022, retail banking, especially digital banking services and products, remain the backbone of our business.
Every day, we are consolidating our reputation as the Middle East’s most progressive and
inspirational challenger bank that is shaping the future of financial services through
convenience, innovation, and trust. We have been at the forefront of adopting digital
technologies to deliver a seamless customer experience and streamline our operations.
Our strategy for the future is to establish and maintain our position as a digital leader in the markets we operate in. This will involve widening and strengthening our digital capabilities.
As we explore new markets and geographies, we will also look to form alliances to back our expansion plans. From a purely digital banking perspective, we will continue to roll out strategic solutions such as Neo, our digital-only consumer platform, across all markets where we operate.
This product is a key enabler of financial inclusion, which is an increasingly important focus for us. We are fundamentally geared towards driving the financial inclusion agenda not just through improving access to financial services and products but also through supporting SMEs, job creation, and the wider digital economy.
PO: What are the key areas of focus for Mashreq Pakistan?
FM: Mashreq endeavors to establish itself as a leading financial institution in digital innovation in Pakistan and the wider region, developing solutions that meet the evolving needs of customers in a market that is becoming increasingly digital and cashless.
We believe in creating a collaborative culture and investing in our people, equipping them with the knowledge and expertise to manage the upcoming demands of the business and delivering the best experience for our clients.
In line with this approach, we successfully implemented an advanced remote operating model to allow for long-term flexibility in work, and we aim to replicate this model in our Pakistan operations in the near term.
Pakistan has a significant scope for growth in the digital economy. The country has a large young and tech-savvy population that is driving the adoption of digital services. As they become increasingly connected, we see strong potential to boost our market share in the country.
PO: What are your plans to further Pakistan’s banking sector?
FM: The asset base of Pakistan’s banking sector increased by 19.6% in CY21 (14.2 percent in CY20) to Rs30 trillion, driven mainly by growth in innovations and investments.
As per the World Bank, 63% of the country’s population comprises youth aged between 15 and 33 years, making it an important destination for digital banking-led financial inclusion. Pakistan also has about 100 million adults without a bank account and 82% women with no access to financial services.
PO: How does Mashreq support SBP’s vision of financial inclusion?
Classification: Public FM: SBP has been making consistent efforts to increase access to banking solutions for all citizens of the country. Mashreq aims to deploy its services to support the Bank’s vision of financial inclusion.
Mashreq intends to support SBP's vision for a financially inclusive and digitally led economy by leveraging its significant digital banking expertise and technology to address the evolving needs of customers in Pakistan. As the world moves towards digital banking, Pakistan has also witnessed a significant surge in transactions processed through digital channels, in both value and volume. Mobile banking and internet banking transactions have seen a considerable increase overall, especially during the past five years, thus making the country an attractive market for Mashreq to offer its digital banking services.
PO: How do you evaluate Pakistan as a potential market?
FM: Pakistan has always been a strategically important market for us, and we continuously
strive to enhance our commitment towards the country and its economy by capitalizing on
digital acceleration in all its business sectors. We aim to bring critical foreign direct investment and our digital banking expertise into the country with a focus on local fintechs and digital incubations centers.
PO: What are your views on the macroeconomic situation in Pakistan and the outlook for the country?
FM: The challenges we faced as you know the past few years have dramatically reshaped the world. The recent flood, pandemic, and economic crisis, coupled with the burgeoning inflation, have also had a deep impact. The geopolitical situation between Russia and Ukraine has only exacerbated the situation.
At the height of these challenges, banks across the globe play a fundamental role in supporting businesses and families by administering government-backed loans, providing additional liquidity, and rapidly implementing forbearance measures. We believe that Pakistan is primed for success and rapid expansion, speaking generally about the nation as well as about its banking sector. SBP has adjusted to the shifting technology environment, which has had a domino effect on how banks view new channels of engagement, reinventing operational models and revitalizing methods to operate from anywhere. Banks that go beyond "skin-deep" personalization and integrate themselves into their clients' daily lives will rule the financial sector in the future.
To thrive in this rapidly transforming arena, banks and businesses alike will need to continue to focus on being connected across front, middle, and back offices now more than ever. Being truly customer-led, regardless of the type of bank – retail, commercial, or investment – will require
Classification: Public reimagined access, distribution, and operating models, harnessing the potential of an increasingly digital economy and maximizing unique ways of working.
