Yemen Gulf BankOnline banking set to grow [Archives:2004/790/Business & Economy]

By Peter Willems
Yemen Times Staff
Yemen Gulf Bank, already a leader of Yemen's retail banking sector, is about to expand its internet banking services.
“We were the first to introduce internet banking three years ago, but now we are upgrading it to be a full-fledged operation,” said Mohammed Al-Zubieri, Chairman of Yemen Gulf Bank.
Up to now, the bank's online banking, which is a rare service offered in the Yemeni banking sector, has allowed customers to take a look at their balances, stop checks and order new checkbooks. One of the features Yemen Gulf Bank is currently developing is transferring funds. In two weeks, customers will be able to transfer money to one of their other accounts in the bank.
The next step will be to let clients move money to another person's or business's account within the bank, followed by the most advanced service which is to transfer funds to an account in another bank locally or in another part of the world.
The biggest obstacle for the more advanced transfers is that the banking sector needs a new law to help protect customers and banks that use the service. Presently, a customer transferring money to his or her own account within the bank is allowed.
“There is still no law to approve and control electronic banking or an electronic signature,” said Al-Zubieri. “This is very important to banks and clients. If there is a dispute, we will go to court and the judge will not consider the electronic signature as a legal transaction.”
According to Al-Zubieri, the Central Bank has recently drafted a proposal for the law and is in the next stage of being passed by the Parliament. “We hope that the law will be passed in one or two months,” Al-Zubieri said.
When Yemen Gulf Bank entered the market in 2001, its strategy was to focus on retail banking. Soon after it opened, it was the first bank in the Yemeni banking sector to offer internet banking. Mobile phone banking was brought to the market by Yemen Gulf Bank, giving customers different services, such as checking their balances. It was the first Yemen-owned bank to set up an ATM.
A number of other commercial banks are focusing on retail banking to offset the limits of lending money and boosting their fee-based income. Arab Bank, based in Amman, Jordan, was the pioneer in bringing in a number of retail products and services a few years ago. It introduced ATMs and phone banking to Yemen, and was the first bank in the local market to issue credit cards under the bank's name.
International Bank of Yemen has been aggressive in the last year to capitalize on retail products and services. It now has more ATMs than any of its competitors and is a Representative of American Express and a Principal Member of Visa and MasterCard. The bank recently introduced a point-of-sale service that allows customers to use a card instead of cash to carry out a transaction at over 150 retail outlets.
Yemen Gulf Bank is now putting together a point-of-sale service by developing a network. It plans to work with four other banks to give more customers access to using plastics at different locations.
“We are working with a company setting up a network between us and four other banks,” said Al-Zubieri. “This will be better than doing it alone, and it will be better for customers from different banks to use the same points of sale.”
Yemen Gulf Bank now has four ATMs and has placed them in locations the bank considers to be convenient to the customers, such as at Shamaila Hari supermarkets in Sana'a and Aden. It has plans to set up five more ATMs in public locations in the next few months. And although it is still operating out of one branch in the capital, branches in Mukalla and Hodeidah should be up and running next year.
But in the near future, Yemen Gulf Bank aims to increase the use of technology by expanding on online banking services.
“We are asking the government to pass the law very soon to allow full-fledged internet banking to be used. The world is moving forward rapidly, so we need to catch up,” said Al-Zubieri. “As soon as the law is passed, we will implement advanced internet banking immediately.”
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