By K Raveendran at CeBIT Eurasia, Istanbul
Turkey’s Aktif Bank has no branches. In fact, in 2007, when the bank embarked on its journey, it did not even have a signboard.
But today, the bank has one of the country’s fastest growing customer bases and every man on the street is its potential customer.
Modelled as a ‘shop in shop’, its products and services are sold by thousands of retail outlets across Turkey, who can offer on the spot credit to buyers who may be short on cash. The bank only remains in the background, although it has full control over what goes on.
This means that the bank offers products and services over some 9,000 touch points, providing hundreds of thousand loans and executes millions of money transfers, insurance and collection transactions. It is a bank for sure, but its activities cover a much broader perspective, building its business within that framework.
The online loan system saw 1.8 trillion lira worth of credit disbursed to about 255,000 customers through these retailers in 2013 alone. In fact, the bank has become the country’s 13th largest in terms of consumer loans, thanks to strategic partnerships with the country’s leading brands in consumer finance. Aktif Bank has managed to reach customers at more than 2,000 dealers in different sectors, becoming a valuable business partner for retailers by providing instant loans.
The new generation bank has an interactive marketing, sales and communication platform, which enables it to offer an array of services, ranging from catalogue product sales to ticket purchases, recharging of public transportation cards, collection of utility bills, topping up of phone credits, insurance and a host of other servicdes. The platform has achieved 800,000 monthly transactions in 73 cities across Turkey.
Aktif Bank is a key sponsor at CeBIT Eurasia Istanbul event, where one of the main themes is innovation. The bank’s track record thus provides credibility to its significant presence at the show.
‘’We have bid adieu to ‘this is how it’s done attitude,’’ says Dr Onder Halisdemir, CEO, who was a key speaker at the event. ‘’The old schemes and the dogmas will only make us followers,’’ he says.
‘’We don’t want to be geniuses, but would rather partake in the normal, integrating the changing lifestyle of consumers, interpreting their needs shaped by change,’’ he points out. The bank considers itself an innovation factory and has been honoured for the approach. In fact, it has become Turkey’s most internationally awarded bank, including the prestigious award as the ‘World’s Most Innovative Bank.’
All this does not mean that the bank is lending recklessly and suffering losses. By the of 2013, the share of individual loans granted within retail banking had reached 30 percent, but the NPL ratio of individual loans was only 1.14 percent, which was much lower than the sectoral average.
Aktif Bank’s other numbers are equally impressive. It is today Turkey’s largest privately owned bank, generating 11.2 billion lira worth business along with affiliated institutions. It has achieved 77 times growth in the past 7 years, taking the bank’s total asset size from 41st place to 24th in the short period.
It is also one of the most profitable banks in Turkey, posting profitability figures far above the averages of both Turkish banking sector and the financial institutions on a global scale, with a return on average equity (ROAE) of 19.4 percent.