Interview with Head of Mortgage Products and Digital, Rosbank, Societe Generale Group

CONSTANTINE FELUKOV: What is your role within Rosbank, and what sets the bank apart from other financial institutions in Russia?

IGOR DMITRIEV: I am Head of Products, Marketing and Digital Business at Mortgage and Real Estate Ecosystem Business Line at Rosbank, Societe Generale group. I am responsible for launching and managing of products, building of digital platform, program management, marketing and digital acquisition, development of digital B2C & B2B channels.

Our bank is a digital business leader in mortgage in Russia. We were the first bank to launch pre-approval via a web channel (at our website), pre-approval via a chat bot (at Facebook, as well as at VK, which is Russia’s popular local social network) and a real-estate database with AI. If we talk about our general approach – we provide several paths for our clients to get their mortgage: on the website, via chat bots, approval by phone and at our partners (web, IOS and android applications).

We understand that a strong market position at the forefront of collaboration with clients and partners is impossible without modern back-office and credit processes. Our main priority is decreasing operational cost, so that we are able to provide a better price for our clients and a better profitability of our business. We launched a wide program of internal automation: AI & machine learning, robotization, document recognition, a step-by-step process for our branch offices, business process automation.

Alongside the development of classical mortgage products, we are working at developing an ecosystem and bundle products for our clients and partners.

FELUKOV: What is the competitive situation for the financial institutions in Russia? How does Russia generally compare with other Western companies in terms of IT development and does being a part of Societe Generale Group give the bank any advantages?

DMITRIEV: When I analyzed the offerings of Russian banks 6 years ago, a typical digital solution in our market had poor functionality and design. Over the last several years, the situation has changed. Russian banking market is now one of the most modern. However, if we talk about the most interesting market where the new developments are taking place – I would look to the Asia-Pacific region (APAC).

Obviously, being a part of worldwide group allows to Rosbank to take many advantages. For example, we are able to share our business experience, design, and expertise globally.

FELUKOV: Historically, how did Rosbank go about managing its IT department? What were its IT practices, in what ways did it outsource its IT tasks?

DMITRIEV: If we talk about our mortgage business line, we have a long history of evolution not only in terms of the project approaches (Agile, Scrum, LeSS, Waterfall), but also in terms of the team management. Seven years ago, we had only 8 developers in-house and an outsourced team of about 10 developers and analysts. Currently, our team consists of around 80 in-house digital analysts, product managers, system analysts and developers, and 30 developers and system analysts on an outstaff model, and around 5-members team on an outsource model. We have chosen to grow expertise in-house, using an external provider to manage the flexible part of our team, and such “hybrid” team proved to be quite successful. Fortunately for us our main partner for front-end solutions, an IT company CMD-soft, understood our goal of having in-house expertise and, as a good partner, adapted its approach to better comply with our needs.

FELUKOV: Could you tell the readers more about Rosbank’s partnership with an IT company CMD-soft?

DMITRIEV: Our partnership with CMD-soft continues for more than 10 years. During the period of fast growth of our digital program, we had a couple of issues: the speed with which CMD-soft increased its allocated resources was slow, and there were problems organizing collaborative development. However, all issues were resolved and for last 3 years we have a very effective relationship.

I think success of effective collaboration results from efforts of both sides. CMD-soft understands our business and project management needs and is able to provide us complex solutions for development of our digital platform: outstaffing specialists, outsourcing development and technical consulting. At our side, we have learned the details of resource management of our partner and understand that we are able to get a cheaper price if we plan our resource needs with a long-term approach. I will be honest to say that CMD-soft is a flexible partner, oriented on a win-win approach to business. There is a popular saying in the IT industry: “We will not do it, because it was not included in the technical requirements”, and I have never heard it from the managers of CMD-soft. Instead, what I hear is: “It was not included in the TR, but let’s find an approach to do it”. I think it is really important to have a partner with common values.

FELUKOV: When the government required quarantine and effectively shut down all retail locations in March 2020, did that feel like a threat to the bank’s business?

DMITRIEV: Yes, that felt like a threat. Especially so for out mortgage business, because prior to the shutdown a normal business process had been to ask a client to visit a bank’s office to confirm and sign the deal. In the period of quarantine, the visiting of branches became difficult.

FELUKOV: What strategy and extra steps did Rosbank undertake to position itself on the winning end of the quarantine? How did the bank prepare itself for the post-quarantine world?

DMITRIEV: Quarantine stimulated us to do what we always wanted to do, but didn’t think our business would depend on. Our strategy has been to keep the client safe and do the work remotely as much as possible. That meant relying even more on the digital component, and providing ways to eliminate branch visits altogether. And that is across all our product offerings and across all our coverage area, i.e. across all of Russia.

We rapidly launched a fully digital deal with our partners (with electronic signage) and branch-less deals with our manager visiting the client. That required intense work, which our “hybrid” IT team was able to absorb. And, it kept our business moving. It turns out that this adaptation effort became not only a foundation for anti-crisis response of our business, but also a driver for future growth. For example, using electronic signatures we were able to provide our mortgage loan for a client in Singapore.

FELUKOV: What is Rosbank’s vision for future development, and what role does IT play in it?

DMITRIEV: I think that main competitors of banks are social networks and social media platforms, which currently are trying to provide their own financial products. I also believe that aggregators, which are currently the partners of banks, will be the first to leave banks behind in a battle for the first contact with clients if they are able to use banks as mere service providers. But banks possess a great advantage - long-term trust in their financial expertise, and offer a priceless value – their money management skills. The money management is especially important, because in a broader sense it is the management of welfare and financial future of the banks’ clients. I think that banks will be able to win the battle for clients. But to do that, banks need to transform their business models and in effect become IT companies with a banking soul and a set of values.