MARYLOU ANDREW: Askari Bank recently launched the AskSona card. Why is this important?

SYED M. HUSAINI: AskSona is a new product; in fact, the banking industry has not seen a similar product before. There are about 6,000 dealers in Pakistan who buy fertiliser from our sister concern, Fauji Fertilizer and they are the customers we are trying to target as Askari Bank customers with the AskSona card. Normally, these dealers would have to go to the bank and make a pay order in favour of Fauji Fertilizer and only once the pay order is cleared would the product be dispatched. AskSona is a debit card, and now all the dealer has to do is to go to one of our branches (we have 320 all over Pakistan), swipe the card and immediately his account is debited for the payable amount; Fauji Fertilizer receives the money online and the fertiliser is dispatched. This means that the overall delivery period is shortened by six days. The AskSona card is offered across Pakistan and has enormous potential for replication. We are moving fast on this and soon we will be going into other products, such as milk supply for instance.

MLA: How many dealers have you succeeded in mobilising so far?

SMH: There are 6,000 fertiliser dealers across the country; we may not mobilise all but there is potential to net in a lot. In the first week or so we mobilised 200.

MLA: Apart from dealers, which segments constitute Askari Bank’s target audience?

SMH: We are targeting the middle class which we think is marginalised when it comes to conventional banking; in our view this segment has a lot of money and a lot of business sense.

MLA: How has Askari Bank evolved since its acquisition by the Fauji Foundation in 2013?

SMH: Askari Bank belonged to the Army Welfare Trust. Banks always have upturns and downturns and Askari started off well but then went through a bad patch. This doesn’t mean the Army Welfare Trust was responsible for this but the business was not coming in. Eventually, it was decided that the Fauji Foundation should take it over. I don’t know why, but one reason could be because the Foundation already had significant corporate experience, given that it was running five or six huge business enterprises, including fertiliser, power plants and food. When Askari was bought out by the Fauji Foundation, I was appointed the first president. Coincidentally, both the owners and the management were new, so we didn’t carry any baggage with us and we started on a new page. The last year and a half has been tremendous, and the figures speak for themselves. We posted a loss of five billion in 2013 and then a profit of over three billion in September 2014.

In the next four to five years Askari will be the number one bank in terms of service quality. The image we want to create is one of integrity and values.

MLA: How much has Askari Bank’s branch network expanded during that time?

SMH: We added 60 branches and this year we will add another 100, so from 260 we have gone to 320 branches and we will go up to 425 by the end of 2015; so growth has been rapid.

MLA: You have also ventured into branchless banking with Zong.

SMH: Yes, we set up Timepey in conjunction with Zong. It is a great product and it has done fairly well, however I am not happy with it. There is a lot of scope, but we have an IT platform problem and we are working on it. Branchless banking is programmed lending, so the IT platform has to be solid. Once we fix this issue, we will be number one.

MLA: What kind of image do you envision for Askari Bank?

SMH: In the next four to five years Askari will be the number one bank in terms of service quality. There have already been remarkable changes in the past year and a half. The image we want to create is one of integrity and values, which is essential to any financial institution. This is going to be the cornerstone of our policy. Today we are the fastest growing bank in Pakistan.

We have introduced good governance, transparency and delegation (all our staff are empowered). The stock market has improved, interest rates went down and things have worked very well.

MLA: Have you ventured into Islamic banking?

SMH: We have about 40 to 50 branches offering Islamic banking services. Islamic banking has great prospects in Pakistan but we believe there is a lot of room for improvement. I hope people will become more scientific and technical about it. Although there is an ideology there, you also have to do some scientific work. Surprisingly, the West has done more work on Islamic banking than we have and the biggest financial markets for Islamic banking are London and Paris. Their reasons were strategic, not necessarily ideological; ours are largely ideological which is fair enough, but then on top of this you have to do some technical banking, some homework.

MLA: What are the challenges and opportunities in Pakistan’s banking sector?

SMH: Tremendous; we are an under-banked country, in that although there are plenty of branches, you still need a range of diversified products. The IT platforms have to be improved to enable more phone banking, more online banking etc. Then consumer finance in Pakistan is very low compared to the rest of the world. So there is a lot of scope here and to realise this potential you need better regulatory laws. Currently banks are very cautious about lending, which is why businessmen often complain that they are forced into investing their own funds.

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