Disruption in SA Financial Services Basani Maluleke October 2019

Contents Banking as we knew it Disruption and the banking revolution This is us MyWORLD | Made to share Advancing lives | In action Conclusion

BANKINGASWEKNEWIT

Banking as we knew it Intimidating Limited advice “You have to wear a suit before visiting a branch.” “How can I grow my wealth and reduce my debt?” Complicated fee structures Don’t get things right the first time “What am I paying for?” “I have to go back to the branch. Again.” Complicated products Unequal treatment “What products will suit my needs?” “What do I have to do to get a black card?”

Disruptionand Thebanking revolution

The banking revolution – ‘treat me like a valued individual’ Know me and my needs Simplify Create products that address my specific concerns. Use language that I understand. Care about me Design processes that make my life easier Help me to reach my financial goals. Let’s get it right the first time. Save me time Protect me Come to me, don’t expect me to come to you. Unless I CHOOSE to go to the bank. Make me feel safe online.

Brand perception Customer satisfaction is the holy grail FUTURE OF CUSTOMER WILL BE INFLUENCED BY: FOCUSING ON DATA AND CUSTOMER SATISFACTION WILL IMPROVE: Higher levels of DIGITAL LITERACY Customer acquisition and retention Increased SMART PHONE usage CROSS-SELL Customers will have more choice Brand perception Higher levels of CONVERGENCE Profitability Increased use of AI to drive personalisation Value for CUSTOMERS

THISISUS

Advancing lives through financial and related services. Our purpose Advancing lives through financial and related services.

our strategy

Customer centricity This is what our customers say…. Our customers are at the heart of everything we do. Understanding our customers and delivering on their needs is key to building a sustainable organisation. Management team actively getting closer to our customers e.g. Customer safari Overall brand sentiment continues to increase - we are building solid trust among South African consumers ‘I was really impressed with the fact that I can open an account online and literally be done with it. I hate the waiting period and 100 pages that one gets to sign in other banks.’ This is what our customers say…. ‘I just want to say big up to African Bank. I was going through financial crisis. You understood my problem and asked me to select the best suitable payment plan. I kept to my agreement and today my loans are paid up and I’m a happy man. Well done to you guys for understanding customer needs and also listening to my problems and being willing to help.’

Culture We have extraordinary people. Culture eats strategy for breakfast…. lunch and dinner!’ Original quote by Peter Drucker We have extraordinary people. Our 2019 people engagement score is 60%. Up from 58 % in 2018. SA benchmark is 38%

Data In today’s world we win or lose on our ability to apply data science and leverage the knowledge and insights we gain to better understand our customers and our business. Big data analytics, AI, Internet of Things, machine learning for improved decision-making Building a data centric organisation as part of our fibre through people, processes and technology Data literacy, change management, data awareness, learning and development, data scientist interns through the Data Distillery Highlights Dual bureau strategy Considered over 20 000 data fields to select the most powerful fields to best differentiate our customers Voice analytics being introduced in Contact Centres Improves customer centricity and efficiency Using data science to better predict lending outcomes Credit decisions have been centralised in a market-leading, award- winning credit decision solution We optimise the offer we make to customers, taking into account their own individual situations, while minimising credit risk Our new credit strategy and scorecard enable our Omni-channel approach; fulfilment of certain low risk customers end-to-end online or over the phone, without them needing to visit a branch

Myworld

MyWORLD | Made to share Over 100 000 MyWORLD 1 2 3 MyWORLD customers Over 100 000 More value than you expect SHARED BANKING Bank together with family and friends. Product 1 Save TIME One simple, convenient experience across channels. Omni 2 Save MONEY & GROW SA’s best savings rate. Zero monthly account fees. Price 3 * As at 27 September 2019

MyWORLD | Made to share

Advancing lives | In action For our people They get it first Launch of MyWORLD to African Bankers, a year before launch to market Digital campaign #GrowForIt actively driving a savings culture internally Learning Support a digital learning culture through the newly introduced ‘Digital Lab’ Build a data culture through awareness and a series of data boot camps Support FAIS accreditation through a FAIS App Support a culture of self-driven learning through the roll out of Udemy licences Wellness Promoting mental wellness through ‘Men and women in conversation’ Promote physical wellness through the new, state of the art Fitworks Gym at the Midrand Support Centre Self-defence classes For our customers Credit Responsible lending MyWORLD 6 accounts, no monthly account fees Lowest bank fees 5.5% interest rate on Primary account and Power Pockets 6.5% interest rate on Savings Pockets Savings and Investment products Best savings and investment interest rates across products Deposit as little at R500 to enjoy best rates Consumer empowerment Free access to individual credit scores Empowerment tips to improve credit scores

Strong financial performance Interim results for 6 months ended 31 March 2019

Excellent SAVINGSANDINVESTMENTS growth

Conclusion Banking is changing to better serve customers and communities The biggest winner of disruption will be consumers At African Bank, the needs of customers are paramount, because everybody is somebody!

THANKYOU!