Case study: FBME
Card Services | Issuing
FBME Card Services
personalises card services globally
FBME Card Services makes international banking financial transactions easier for high net worth individuals and corporates with tailor-made card products for them through CadencieTM.
FBME Card Services (FBMECS) pushes the boundaries beyond the comfortable territory of traditional card operations that are extensions of retail banks by courageously driving business in its own right. It is bold – in part because its owner is predominately a trade finance bank rather than retail bank; and for the rest – because it can. It seeks to get the most out of the card opportunities and uses the ‘multi’ dimensions of Cadencie with zeal.
From its Nicosia base, FBMECS services customers who fit its client profile rather than people who happen to live in its immediate geography. It is not in competition with local banks in Cyprus. It services its parent bank clients as well as using technology to extend the frontiers. FBMECS has a growing international client base across 200 countries because of the nature of the FBME parent business, with 20 languages covered by its call centres. Its card covers six currencies with the number expanding to meet new opportunities. While many card management systems would be challenged by these demands, Cadencie is specifically designed to be multi issuer, multi acquirer, multi currency and multilingual. Its modern design allows the launch of new products up to 55 percent faster – an important selling point for a bank that has built a reputation on delivering innovative, customised products and services.
FBMECS CEO Guy El Khoury said that rather than sell across such a vast geographical spread, “Most of the customers actually find us. We have a reputation for being a high customer service, low volume type merchant bank/private bank. We are a specialised bank that prefers to focus on quality rather than quantity. Some want the standard product but many come to us for a customised card product – including co-branding and affinity schemes. Most of our clients travel all over the world or are from all over. Often they have some link to Cyprus in their international trading or in working with our other branches and so they find us by what we do rather than what we say.”
FBMECS uses many of the features of Cadencie in its assertive reach. It uses multi-institution processing to provide card services offerings to its parent bank in Tanzania and to distinct other banks overseas within the group in either retail banking, merchant banking or trade finance. It already has a deal to provide MasterCard partner services as a third party processor within the EU. Essentially, FMBECS is using the multi-institution capability to drive a new source of revenue for the card service operation. It takes advantage of the Cadencie features to match the diversity of the operational needs each institution requires.
FBMECS are leaders. Its owners have been confident at estimating future markets so were early into establishing a branch in Moscow as a financial centre. They have a bank in Lebanon. They have positioned themselves in Africa seeing the intense local interest in cards as the way of riding what they believe will be a booming market – so they purchased a bank in Tanzania as one of the most stable and growing countries in the region to provide its base for expansion. Currently there is a low penetration of bank accounts – by tying in a debit card to a bank account they see considerable scope to provide convenience and security through the card.
So the bank has been specifically structured to service several Central and Eastern European countries as well as parts of Africa, Middle East and Asia – while still supporting an even wider service sweep that includes a network of over 700 correspondent banks.
Charge card & debit drive business
FBMECS primary customers use charge card, with increasing interest in debit and prepaid. The business started with a secured deposit charge card operating as a deferred debit facility because it made sense to the customers and to FBMECS, given the realities of customers’ actual needs and geographical spread making credit checks and collections challenging. El Khoury explains that many of their customers do not need a line of credit. As high net worth individuals, they just want effective payment facilitation and perfect service – this is seen as a distinct strong trend away from the conventional credit card.
FBMECS issued one of the first MasterCard debit in Europe, and went on with Visa to work with the online community. For many it is an Internet card where the clients want a payment tool for their daily operational needs with a positive balance rather than a line of credit.
El Khoury said the card is not just for small transactions, being used for much international remittance activity as well as payroll. He gives an example of one client who uses the card to make huge deposits and so wanted to take advantage of the positive balance rates. El Khoury sees the card system providing micro segmentation down to one client if necessary. One client rang in and asked to have her limit raised to 50,000 because she was in Switzerland and wanted to buy a special watch.
FBMECS had previously depended on an outsourced card management service and had to develop extensive front-end systems to provide the special features it wanted. It recognised that rather than depending on bits and pieces, it needed integrations through a high service card authorisation and card management system.
It required a real-time solution capable of processing multiple banks in different time zones, currencies and languages on the one instance of the software – all while maintaining the security and integrity of customer information. FBMECS selected GFG Group to partner with and implement its Card Management system in November 2004 after a rigorous international study of alternative solutions.
El Khoury says that with Cadencie they are now experiencing more control, more choices and more control over their destiny. He sees the relationship with GFG Group as what he wanted – “We feel much more in control than before.” And this is one of the reasons why FBME “likes to deal with only a very select amount of partners because we like to feel more in control of our business and our destination. One of the advantages of all this is that we can move very quickly.”
El Khoury explains that they had predicted the next major trend and wanted a system that could cope. That trend is a complete seamless integration between the Internet and the real world, giving a payment tool for both the online and traditional commercial transaction environments.
Currently with the Internet, FBMECS issues clients with an actual card and makes it possible for the customer to manage as much of their own card accounts in self-service. For some clients there is a closed-loop environment for Internet purchases while for others the e-Commerce is even further extended.
FBMECS is going to be offering the merchant acquiring features of Cadencie to existing specific high value clients of the bank rather than broadly going out to retail merchants en masse. El Khoury explained that it would be a niche offering with targeted features and high value rather than the usual bulk. Example clients are airports and shopping malls with specific solutions for their environments.
As for competitive advantage, El Khoury as CEO sees quality as the central point. “You aim for the highest standard you can set yourself and let the market around you catch up.” He believes with the partnership he is getting close to the standard he seeks and every day he is seeing improvements that are very encouraging.
FBMECS business profile
FBMECS prides itself on pioneering, innovative tailor-made banking solutions, coupled with excellent personalised customer service. The company comes from an experienced and progressive financial heritage steeped in providing international banking expertise and solutions to its customers since 1983.
The Management team has extensive international business knowledge and proven skills in the global financial services industry. From a foundation rooted in trust, experience, prudent management and utmost discretion it has carefully built a unique reputation for forging lasting relationships and history with clientele worldwide, offering financial products and services through five key business lines: Personal Banking, Corporate Banking, Investment Banking, Correspondent Banking and Card Services/Payment Systems.
FBMECS is committed to improving the customer’s business experience through innovative services, personalised customer care and sustained growth. “We firmly believe that a good bank is one that makes you feel special. We put this axiom at the forefront of our daily activities – at FBMECS, we take your business personally.” www.fbme.com