Discovery Bank is expected to roll out publicly in March, following a five month internal beta testing phase.
The public launch of the bank is slightly later than originally anticipated (it had previously targeted a 2018 launch), while the costs associated with opening the bank have also crept slightly over budget.
In its half year results presentation, ending 31 December 2018, Discovery said that a total of R6 billion has been invested in the bank.
“Our current priority is to build service, technology and operational excellence, and in particular, our initial focus will be to successfully migrate 300,000 plus Discovery Card clients onto the bank platform,” Discovery said.
“We will continue to grow and attract new clients, with the most important measure being the value that we offer our clients through our product offering, investment in technology and service excellence.”
It added that successful entry into banking is one of its key objectives – and while market share is certainly important – it plans to measure the bank’s success in relation to its role in the shared-value model and the value it brings to people as a first of its kind behavioural bank.
“We have a deep belief in the power of the model – leveraging superior actuarial dynamics to improve customer’s behaviour which in turn builds a better business,” it said.
“In our view, the bank is an example of shared value in its purest form – the behavioural banking design addresses the important societal need of poor financial behaviour, clients benefits from immediate rewards, and the bank will benefit from an improved risk profile.”
According to Forrester analyst on emerging technology, Oliwia Berdak, Discovery Bank has a good chance of success in the market against the established institutions as it already has an established customer base to leverage, and will engage customers in new ways.
Discovery said that the behaviour change component of its bank offering – Vitality Money – has been built on its highly successful Vitality model.
This would allow the potential and more opportunities for the bank to offer clients value as they further integrate their Discovery products, it said.
“An important part of the Bank product offering currently, is bank rewards, where clients can boost their Vitality rewards across the business – such as gym discounts and fuel rewards – as they manage their finances better,” Discovery said.
“The bank leverages the Vitality partner chassis to create an attractive ecosystem of rewards for clients in the form of dynamic discounts that deepen Vitality’s incentives.
“Existing Discovery clients can look forward to benefiting from integrating their Discovery products with the bank, through access to more affordable life insurance, faster-growing investments, smarter insurance and convenient payments for healthcare expenses,” it said.