Hang Seng Bank deploys fintech to simplify mobile banking, mulls use of facial recognition at ATMs

Hang Seng Bank plans to expand the use of fintech to mobile banking services and is also toying with the idea of incorporating facial recognition, after initial success with iPhone X, to allow customers to withdraw cash from its ATMs across the city, according to its chief executive.

“As a community [oriented] bank with 3.4 million customers, Hang Seng Bank is very keen on developing fintech to capture the new generation of tech savvy banking customers,” Louisa Cheang Wai-wan told the South China Morning Post in an interview.

“Regarding facial recognition for ATMs, we are constantly reviewing our services based on different factors including market developments and related requirements.”

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Since December, the bank’s customers have been able to use facial recognition built in the iPhone X to log on to its mobile banking platform, and its ATMs too are yet incorporate facial recognition.

Hong Kong lags behind the mainland in adopting facial recognition, which uses biometric authentication applications to identify an individual from a database of digital images. In China many sectors have been quick to adopt facial recognition technology to improve and speed up services – ranging from aircraft boarding passes to accessing offices and museums and even accessing banking services.

The global facial recognition market is forecast to be worth US$6.5 billion by 2021, up from US$2.3 billion in 2016, according to estimates from research company Technavio.

Cheang said the bank will soon launch “mobile security key” on its banking app, which will allow customers to generate security code to access internet banking services with ease in a faster and more convenient manner, instead of the current practise of using a physical security device.

Hang Seng’s parent HSBC has already adopted mobile security key and facial recognition.

For customers worried about their privacy, she said customers will always have a choice.

“Customers may stick to using passwords to log on for their banking services, while some may like to use their faces, voices or fingerprints to get these services. What we need to do is to make sure we offer sufficient choices for customers,” she said.

Cheang, the only female chief executive among the companies that make the Hang Seng China 50 Index, took the top job at Hang Seng Bank in July last year after Rose Lee Wai-mun retired. Earlier she was with HSBC as group general manager and group head of retail banking.

The use of fintech is growing at the bank, with the introduction in January of chatbots to answer queries from customers. In November, it unveiled voice recognition for its phone banking services and also started accepting fingerprint authentication in its mobile app from June. 

“Customers have become more receptive towards these services. For example, more than 50 per cent of our e-banking customers using iPhones log on to our platform with Touch ID [fingerprint authentication],” she said. 

No data was available on the use of facial recognition since it has been recently launched. 

“We see a growing trend in the take-up of different products and services via digital channels. The number of securities and travel insurance transactions conducted via digital channels increased by 30 per cent and 11 per cent year-on-year respectively in 2017. Non-branch channels continued to account for 98 per cent of securities transactions by count.”

Her next move is to introduce more digital and fintech services for corporate clients, noting many small and medium sized customers would like to use these new services. 

Also in the mainland, the bank would like to expand its digital banking services instead of opening new branches.

“I don’t think Hang Seng Bank can compete with the state owned banks which have thousands of branches across the country. However, we can develop digital banking and other internet-based banking services to capture the market of 1.3 billion people,” she said.  

The bank is also reaching out to the youth by setting up branches at universities and offering online merchant services that appeals to them.

“Our aim is to build a lasting relationship with the youth,” she said.