Petia Dimitrova: Postbank and Doverie PAC became strategic partners in offering innovative financial solutions
28 October 2021
An interview with Petia Dimitrova, CEO and Chairperson of the Management Board of Postbank for Banker.
Mrs. Dimitrova, this year Postbank celebrated its 30th anniversary. What was 2021 like for the financial institution?
Postbank welcomed its 30th year among the leaders in the banking sector. We are third in terms of loan portfolio and fourth biggest bank in Bulgaria in assets and deposit size, with a market share of above 10%, more than 200 branches country-wide and more than 100 awards won for our digital innovations and products, services and corporate social responsibility and sustainability in society policy. The Bulgarian Credit Rating Agency raised its long-term rating for Postbank from BBB- to BBB with an unchanged short-term rating of A-3 and at the same time changed the perspective from positive to stable.
Our most valuable asset – the team – stands behind these figures and well-deserved achievements. Thanks to it, we have proven ourselves as one of the most successful systemic banks in Bulgaria. We became an institution that weaved success in its corporate DNA over the years, that shows how to combine different values in a whole and that is often copied by other banks. These successes would not have been possible without the support of our customers and the shareholders from the strong international group Postbank is a part of, for which I would like to extend my gratitude.
What goals and partnerships have you directed resources and investment in throughout the year?
As one of the leaders on the financial services market, our efforts are aimed at constantly developing and building on the wide variety of innovative solutions. Just a few days ago we started a strategic partnership with the largest pension assurance company in the country – Doverie. Offering quality pension insurance products allows us to cover the diverse needs and expectations of our customers, giving them the opportunity to plan long-term in detail, ensuring the peace of mind and financial independence they need at that stage of their lives.
With this partnership, our customers will be able to quickly, easily and conveniently conclude their first contract for supplementary pension assurance, as well as to transfer the funds accumulated in another universal or professional fund to one managed by Doverie Pension Assurance Company (PAC). The agreement will provide all users with long-term plans the option to join a voluntary pension fund, offering them a higher standard of living after reaching retirement age. Alongside all other benefits, supplementary pension insurance also allows to generate return on investment at a moderate risk level.
In this wide scope of cooperation, we will also offer a special product for Doverie PAC customers reaching the age of retiring, giving them the option of affordable daily banking. Furthermore, Doverie PAC customers, employees and agents will be able to take advantage of Postbank’s innovative financial products and individual solutions.
The new high-tech service you presented – Smart POS by Postbank – makes the smartphone a POS terminal. Is business ready for this innovation and what are its advantages?
The customer experience is at the heart of our efforts to constantly improve the vast portfolio of products and services we offer our customers. Therefore, we constantly develop and build upon modern digital solutions saving time and money. Postbank is the first of banks in Bulgaria to offer a mobile contactless payment app which quickly, easily and conveniently makes a smartphone a POS terminal. This is an app with which every merchant can accept contactless Visa and Mastercard payments from their customers straight through their smartphone, without needing the traditional POS terminal. The innovative service we add to our rich portfolio of digital services is focused on developing the entrepreneurial ecosystem and with it the bank caters to the changing needs of clients.
The app offers an easy and convenient solution for contactless payments to every merchant and is attractive for both the smaller niche business and the larger corporate customers because what unites them is mobility – the key to the effective growth of many of the industries.
What does this mean for the end consumer?
Smart POS by Postbank is here to further develop the established business model and make contactless payments even more accessible and convenient. This in itself will widen access to contactless payments for end customers, which is convenient but also important in pandemic conditions. Using the capabilities of modern technologies in banking, we once again cater to our customers’ needs of speed, convenience and accessibility of the services we offer.
This high-tech service is our first innovation of such a kind, with which we again address the global trend of consumers increasingly preferring digital forms of payments to traditional methods. Postbank’s software POS adds value to the business of merchants who use it and to the service end customers receive. And for industries using mobile POS devices, switching to a software POS is a much more profitable and easier to maintain solution as it provides more successful business and sales management and easier planning via the accessible reporting.
What are your observations – how do Bulgarians prefer paying – online by card or cash on delivery?
Cash is still the preferred payment method here, although in the past years the share of electronic payments has been steadily increasing. The pandemic also accelerated the use of electronic payment tools. With time, however, cash will be losing its importance and people will increasingly appreciate the comfort of electronic money. In the countries most advanced in this respect, the share of cash payments is now less than 10% of all payments and there is already talk of completely cash-free societies.
We have our very successful projects in this aspect as well, as a year after starting our unique digital express banking zones, we upgraded their functionalities, adding a wide variety of new capabilities, providing even more convenience to our customers. The modern devices are already accessible in 34 towns where 75% of Bulgarian urban population lives. The unparalleled on the Bulgarian market service offers speed, convenience and saves customers money thanks to the wide variety of transactions with up to 65% lower fees than in a branch.
The concept of developing high-tech devices is an innovation with which we at Postbank address the global trend of customers increasingly preferring digital forms of banking services. The data that for less than a year almost 40% of customers in the busiest offices choose to bank completely independently is an indicator of the rapidly growing popularity.
What is the profile of customers who prefer to take advantage of the digital zones?
Our observations show that young people, students, just now starting to use banking services, as well as people in retirement age, independently managing their personal finances, are both among customers who prefer the express services of modern devices. The average age of users is 42.5 years, with the youngest registered just 18, and the oldest – 96 years old. We also noted an impressive variety of representatives of different professions from all sectors of the Bulgarian economy among the regular users of the innovative digital zones. The exceptional popularity of this unique service is due to the wide range of options for independent banking, unparalleled on the Bulgarian market, and to the speed and convenience it offers.
Today customers can not only carry out the most frequent banking transactions in our innovative digital zones, but they can also make installments in cards and accounts in both Euro and Bulgarian levs. Another functionality we added to the innovative devices is issuing an e-receipt when carrying out a banking operation or transaction. Thus, we and our customers can lower our footprint on the environment and contribute to protecting natural resources. Other banks’ customers can also use the functional devices for cash withdrawal and utility bill payments. This way, we once again meet the expectations of our customers, offering them the necessary convenience in the busy everyday lives of modern users.
What role does business play for a prosperous society?
In times when we are all facing challenges we have never seen before, companies increasingly invest in important causes, promoting good practices in corporate donations and setting high standards of corporate social responsibility.
The topic of Environmental, Social & Governance (ESG) is actively making its way on the public agenda with specific actions being undertaken and advancements in these aspects being assessed.
Our international group – the Eurobank Group – is proud of its outstanding achievements in the field of environmental protection and compliance with the sustainable development goals, therefore we are determined to integrate and enrich its best practices. Postbank has consolidated its position as a socially responsible company, joining the signatories of the United Nations Environment Programme Finance Initiative (UNEP FI) Principles for Responsible Banking in 2020. This important step made Postbank the only financial institution in Bulgaria that chose to be led in all aspects of its activity entirely by the single framework for sustainable development in the banking sector, developed with the innovative partnership between leading banking institutions globally and the Programme’s Finance Initiative. The Principles for Responsible Banking determine the role and responsibility of the banking sector in forming a sustainable future and aligning the banking sector in compliance with the UN Sustainable Development Goals and the Paris Climate Accords of 2015.
As one of the leading banks on the Bulgarian market, we will continue pursuing a long-term and sustainable social policy in all these fields through our internal policies and rules for investment decisions, aligned with the factors of socially responsible investing and the investors’ level of commitment regarding the risks for such investment in companies from their portfolio. Long-term social responsibility policies in the bank are implemented through real actions for protecting the environment and lowering the carbon footprint.
In the following years, there will be a significant increase in offering structured green energy products and loans in support of the so-called Green Transition. If until recently green projects were in the periphery of commercial banks’ risk appetite, the situation we are currently in and Europe’s priorities significantly influenced our philosophy. We are now looking for the next generation of portfolio guarantees, designed to contribute to climate actions and environmental sustainability.
This year, we implemented one of our most successful projects in the field of sustainable development – A Universe of Opportunities, Postbank’s innovative digital platform, created to promote interesting ideas related to social entrepreneurship benefitting society. A total of 238 projects with potential in the key fields of Digital Innovations, Education and Green Projects reached the final stage of the competition and following the decisive vote of a renowned jury three winners were selected – one project in each category. They completely reflect the mission and values of Postbank that we will still be abiding by in 2022 too, never ceasing to offer innovative digital solutions, to develop green initiatives and to contribute to achievements in education.
