September 3, 2021

“SHYFTING” MINDSETS: BUILDING STANDARD BANK’S DIGITAL FX APP SHYFT

Background

Standard Bank Group is the largest African banking group by assets; US$170bn, and an employee headcount of 55,000. Founded over 150 years ago, the business is a client-centered, digitally enabled financial organization. It has a presence in 20 countries on the African continent — building its first franchise in the sub-Saharan region 30 years ago — and has additional branches in Europe, the Americas and Asia.

Today, Standard Bank offers a range of banking and related financial services to facilitate growth, diversification and development in Africa; and maintains a strategic partnership with the largest bank in the world, Industrial and Commercial Bank of China (ICBC), who is a 20% shareholder in the group.

 


Challenge

Standard Bank customers were looking for faster and more convenient cross-border payment solutions to manage their foreign exchange (FX). The business’s knowledge and experience of working in South Africa told it that South Africans are generally aware of and responsive to the volatility of the Rand and FX rates – and that it is common practice for funds to be regularly moved offshore.

Unfortunately, conducting FX in South Africa has traditionally been a tedious, paper-based process. This limited which South Africans were able to make FX transactions and the speed at which they could do so.

Thus, there was a huge opportunity in South Africa for Fintechs and banks interested in digital transformation. What’s more, many South Africans have access to smartphones. South African Millennials in particular were ready to access banking services through their mobile phones and to conduct FX transactions in a digital-first way.

Standard Bank wasn’t the only organization to realize this; disruptive Fintechs were on the rise and were gaining market share. If Standard Bank wanted to provide South Africa with highly accessible FX services and an innovative cross-border payment system, they needed a way to respond to these challenges and seize the opportunity fast.

 


Partnership

“The partnership with Currencycloud has been vital to the success of Shyft. Currencycloud really understood the challenges Standard Bank were facing and have delivered a solution that improved our speed to market, whilst reducing costs and delivering operational efficiency As we continue to grow the Shyft solution for our customers, we are confident that Currencycloud will continue to help find solutions to our customer challenges and deliver value to Standard Bank across Africa.”

Arno von Helden Head of the Shyft Platform at Standard Bank Group

A business of Standard Bank’s capabilities could have easily built a proprietary FX and payments platform from the ground up to respond to the challenges and risks to its market share. But doing so would have meant working with and around a great deal of legacy technology that would slow down development and potentially impact the quality of the solution.

Standard Bank knew that if it were to quickly deliver a solution that would meet their target Millennial demographic’s expectations, they would need to take a greenfield approach. Standard Bank decided to build a new digital banking app called Shyft that would serve as an all-in-one FX solution for South Africans. The project needed to provide rapid FX transactions at low cost, store multiple currencies in a single wallet and allow for transactions to take place anywhere in the world. But the project had to be completed quickly while offering a flawless customer experience at the same time.

Currencyloud’s payment platform and APIs were the perfect solution. For example, Currencycloud’s multi-currency virtual account enables our customers to collect, convert, pay and manage funds in more than 35 different global currencies. For Shyft specifically, Standard Bank leveraged Currencycloud’s technology to enable its customers to buy, exchange and store US and Australian Dollars, Euros, South African Rands and Pounds Sterling. Because Currencycloud’s global cross-border payment system and banking network provides access to local payment schemes, Standard Bank was able to more efficiently process cross-border payments and offer attractive FX rates as a result.

Additionally, Currencycloud’s compliance team has been a true business partner to the Shyft team throughout the course of their engagement. To reduce risk and ensure the platform’s robustness, Currencycloud and Shyft share knowledge and insight, enabling both parties’ compliance systems to work in harmony and in line with best practices.

Standard Bank appreciated Currencycloud’s drive to understand their business issues and find a real solution that was future proof. Plus, Currencycloud’s API-driven technology meant that Standard Bank gained significant speed to market. For the bank’s competitors, speed to market had been one of their main competitive advantages; working with Currencycloud enabled Standard Bank to close the gap.

The entire project was delivered on a high-availability cloud-hosting solution provided by Amazon Web Services (AWS). With key features including private encryption, multiple databases for 99.9999% availability and highly secure segregated environments, the solution delivered the reliability and assurance Standard Bank needs. And with system health constantly monitored, the company is able to maintain an optimum cost-to-performance ratio at all times.

As a result, the team built and implemented Shyft in record time. The beta version was up and running in less than three months and in the hands of end-users just weeks later.

 


Results

Shyft has been a remarkable success. Since Currencycloud first collaborated with Standard Bank to build Shyft, the app has grown fast, developed new capabilities and enabled new growth opportunities for Standard Bank. Shyft was first launched in 2017, and since then, the app and the partnership between Currencycloud and Standard Bank has only grown.

To date, the app has:

        • Delivered over USD$750mn in FX purchases, 
        • Processed over 72,000 payments
        • Issued over 72,000 virtual cards
        • Built up a user base of 100,000 users

Furthermore, 15% of those users are non-Standard Bank customers — thus, Shyft is exposing Standard Bank to new prospective customers who they may not have had access to otherwise.

But most significantly and with Currencycloud’s support, the Shyft app has reduced Standard Bank’s cross-border payment processing time fourfold.

“Since joining Currencycloud, the average payment settlement time for a cross-border payment from South Africa into Europe, the US and the UK has dropped from four days to less than one day. So, processing time is four times better than it used to be,” said Arno von Helden, Head of the Shyft Platform at Standard Bank. “And our processing costs are significantly lower than they used to be,” he added.

Standard Bank, Shyft and Currencycloud have been hard at work ensuring the app provides access to financial services to all of Africa. The most recent development — Shyft Shares — enables users to purchase from 120 global investment options, including companies like Alibaba, Zoom and Netflix and from exchange-traded funds (ETFs) as well.

On the horizon, Standard Bank and Shyft hope to expand outward from South Africa into more of the African continent, starting with Botswana. Throughout this process, Currencycloud is supporting the bank’s compliance needs, ensuring that future partners meet regulatory standards. Standard Bank and Currencycloud are exploring new opportunities to grow, collaborate and increase the accessibility of the global financial landscape.

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