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Technology as a Solution to Digital Transformation: A Case Story of LB Finance PLC

Thusitha Wickrama – Treasury Department

Shaping the Business through Digital Financing

LB Finance is one of the leading financial service providers in the country. We are invested in the process of transforming our customers’ lives with optimal financial solutions.

Shifting the financial industry into a digital age may be summed up as moving towards a digital finance platform, in which customers can access their financial services via the internet or a specialized application. We thrive to provide quicker and less complicated financing services, which are advantageous not just to the customer but also to the financial institution that provides them.

Both the supply of financial products and the processing of transactions are now highly automated mainly due to the use of internet services and Application Programming Interfaces (APIs).

Since the development of the National QR code specification, ‘LankaQR’, more businesses have been encouraged to become acquirers because of the low maintenance costs, low start-up costs, and low transaction costs for customers. The ‘LankaQR’ system also guarantees that various forms of payments will work together smoothly. During the last year under review, several financial institutions introduced payment solutions based on ‘LankaQR’ mobile coding system with the participation of Central Bank of Sri Lanka.

Within the period of 2021/22, the volume of app-based financing transactions was over Rs. 1 Billion. Because of this change, the company is now able to improve its operational efficiency while also providing more convenient digital facilities for the customers.

A Difference for a Cause

The design and development process began with an in-depth familiarity with the ways in which digital natives think and act, as well as a determination to create services from the client's vantage point, asking questions like "when" and "how" the customer would like to use the financial services being offered. Taking this route helped LBF develop a smooth app that users are eager to engage with again. It's not only a financial services hub; by making data driven advertising a service, it's delivering significant value to clients in other areas as well.

Information Technology Assets for Future Potentials

In order to guarantee a high degree of performance, stability and availability of business-critical systems, LBF's IT infrastructure is constructed to manage enormous and fluctuating workloads. LBF makes it a priority to embrace cutting-edge innovations, simplify their operations whenever possible, and provide their clients with digital solutions that support their strategic goals. Specifically, Digital Financial Services (DFS) Unit and the Centre for Technology and Innovation (CTI); the two dedicated facilities committed to integrating the technological advancements into the business practices, use a mix of licensed software purchased from third-party suppliers and the ones developed in-house at CTI.

Sharpening the Digital End through DFS Unit and CIM Mobile App

To speed up its transition to a completely digital financial institution, LBF established DFS and CTI particularly to concentrate on creating distinctive front-end digital channels that would provide value to LBF's clientele. As an idea conceived, developed, and brought to reality solely by DFS, LB CIM (Cash in Mobile) digital wallet was launched in response to the pressing necessity for such a platform in order to circumvent movement constraints brought on by the pandemic. Using shared infrastructure and digital process automation, LBF hopes to speed up the rollout of the company's digital capabilities.

LBF focuses on the Small and Medium Scale Enterprises (SME) and Micro, Small and Medium Scale Enterprises (MSME) segment to enable digital financing with distinctive yet simple features compared to prevailing mobile apps in Sri Lanka. LBF recognized that there is a neglected market which has a great potential with its size. This was the reason to develop a mobile app which facilitates SME/ MSME customers or businesses to tackle their transactions in their own language with the trilingual options facilitating English, Sinhala and Tamil customers. Many SME/ MSME owners have expressed their preference for CIM App in terms of making payments to their suppliers and customers. Those in the Business to Business (B2B) segment generally have a higher propensity to pay and receive payments through mobile based financing compared to the Business to Customer (B2C) segment.

First Time in South Asia - ORACLE Fusion Enterprise Resource Planning

LBF is the first finance company in South Asia to implement the world-famous 'ORACLE Fusion' Enterprise Resource Planning (ERP) system to handle 100% of LBF's back-end functions, which include finance, procurement and inventory control. Being a comprehensive ERP System that runs on the cloud, "ORACLE Fusion" not only helps to significantly improve process efficiency, but it also helps to reduce infrastructure costs, which are costs that would have otherwise been imposed on hardware, software, and maintenance.

Future Ready Business Process - Robotic Process Automation (RPA)

LBF's collaboration with POTENZA, a Digital Asset Transformation Company, and UiPath, one of the leaders in the international Robotic Technology Automation (RPA) space to accelerate internal automation process with the use of RPA is a testament to the company's dedication to being the pioneering innovator among peers. The real potential of LBF was unlocked via Digitalization and RPA of core processes like Financial Consolidations and Insurance Payment. The RPA method also improved the efficiency of financial procedures, such as the reconciliation of LankaPay channels including Conventional Electronic Transfer ff funds (CEFT), Sri Lanka Inter - bank Payment Method (SLIPS), Standard ATM Switch (CAS), and payment transactions using Visa Cards.

The new system can be further enhanced by getting equipped with the potential of dictating and enforcing minimal mandatory information needs for each and every kind of financial activity. After that, the financial institution will be capable of performing a full product simplification process and mapping to the digital platform with less resources and time.

Consequently, digital data transmission will reduce the amount of time needed to migrate the existing company, and delivers financial firms with complete control as well as the adaptability to sequence their mobility in accordance with the needs that are particular to them.

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