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Kasikornbank’s retail business outperforms on back of strong loan and customer growth

https://live.theasianbanker.com/
Written by William De Vijlder  
  • Jan 01, 1970
  • 12 min read

Kasikornbank’s retail banking business posted strong growth in 2021. The bank’s performance reflects another year of successful execution of its customer-centric strategy.

  • Kasikornbank increased retail loans by 11.5% to $20.35 billion
  • The bank’s retail customer base increased by 10.2% to 18.1 million
  • The bank launched new hybrid branches

Kasikornbank was recognised as the best retail bank in Thailand by The Asian Banker Excellence in Retail Financial Services programme. The bank’s retail loans increased by 11.5% year-on-year (YoY) from $18.26 billion in 2020 to $20.35 billion in 2021. Retail customers increased by 10.2% from 16.4 million in 2020 to 18.1 million in 2021.  Users of its K PLUS mobile app increased by 18.75% from 14.1 million in 2020 to 17.1 million in 2021. K PLUS transactions increased by 42.67% from 14.5 billion transactions in 2020 to 20.71 billion transactions in 2021.

Financials: Kasikornbank increased its retail loans by 11.5%

In 2021, Kasikornbank saw its retail loans reach $20.35 billion, a loan growth of 11.5% from $18.26 billion in 2020. The retail loan portfolio structure grew by 1%, from 28% to 29% in 2021. Retail loans grew mainly from credit card, personal and home loans. The bank launched a new channel for self-service consumer loan application via K PLUS. 

Its cost-to-income ratio (CIR) improved to 43.4% in 2021 from 45.1% in 2020, within its target range.  The better CIR is due to an increase in total net income and continued focus on cost management and productivity improvement, with new investments for future growth.

In comparison, the largest bank in Thailand by asset size, Bangkok Bank saw its CIR improve by 5.6 percentage points, to 50% in 2021 from 55.6% in 2020. UOB Thailand’s CIR in retail business eased marginally by 0.8%, to 51.5% in 2021 from 52.3% in 2020.

Kasikornbank’s YoY growth in retail loans was 11.5% compared to 2.2% for Siam Commercial Bank.

Customer Experience: The bank’s retail customers increased by 10.2% to 18.1 million 2021

Kasikornbank witnessed the highest increase in retail customers, reaching 18.1 million, a 10.2% growth over the 16.4 million in 2020, which was in turn a 7.2% increase over the 15.3 million in 2019.

In comparison, Siam Commercial Bank’s retail customers increased by 3.68% YoY to 16.9 million in 2021 from 16.3 million in 2020.

Kasikornbank’s mobile banking platform, K PLUS saw a growth in both users and transactions. The total users in 2021 grew by 18.75%, reaching 17.1 million compared to 14.4 million in 2020. This compares with Siam Commercial Bank’s 13 million SCB Easy mobile users in 2021.

The bank defines active users as those who log into the system at least once a month. Seventy-five per cent or 12.8 million of Kasikornbank’s total users were active as of 2021. Moreover, the number of transactions grew by 42.7% in 2021 reaching 20.71 billion compared to 14.51 billion in 2020. On Google play, K PLUS has a rating of 4.2 and more than 10 million downloads. K PLUS integrates management information system and customer relationship management through its adobe intelligent marketing platform. It is also linked to Google analytics for monitoring user experience.

On the other hand, Bangkok Bank’s mobile banking platform “Bualuang mBanking” has a rating of 4.1 on Google play while Siam Commercial bank’s “SCB Easy” has a rating of 3.7 and Krung Thai Bank’s “Krungthai NEXT” has a rating of 3.8

Kasikornbank also offers “Smart Pay and Smart Cash” via K PLUS” for credit card customers to easily access these services. In addition, the bank offers a new feature, "Swipe, Press, Pay by Installments in one card," for Xpress Cash customers. The bank also enables customers to scan quick response (QR) code for cardless cash withdrawal at K-ATMs nationwide and make money transfer free of charge, 24 by 7 via K PLUS.

The bank launched new hybrid branches to serve different customer segments

To offer customers a more seamless experience, Kasikornbank introduced a new branch design that increases the flexibility and efficiency of banking services. The service area and all furniture are specially designed to assist branch staff to smoothly facilitate customer’s adoption of self-service machines and digital channels (K PLUS). The modularly designed counters accommodate various transaction types.

Kasikornbank launched its community branch, called K PARK, in the outskirts of the city as it expands its services to more villages and schools. K PARK provides financial zones for transactions and co-working spaces, with “Kids Zone” and other services from its partners.

In addition, e-machines are made available in these branches to serve as authentication touch points for all digital onboarding such as for e-Savings and e-Wallet account opening. The e-machines provide additional convenience from normal branches.

The bank also launched the Wisdom lounge, an exclusive centre that provides the full range of services and facilities for high-net-worth individuals and affluent customers.

The bank also appoints KBank Service banking agents, business partners with extensive network coverage and operate extended hours, to provide specific banking services to customers such as cash deposits and withdrawals, bill payments, and identity verification electronic account opening for retail customers.