A new challenge for banks

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Training and skills development are extremely important in the face of emerging technological advances. They reduce job ambiguity and skills obsolescence, providing job security

February 14, 2022, 12:30 p.m.

Last modification: February 14, 2022, 12:41 p.m.

Md Kafi Khan. Illustration: TBS

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Md Kafi Khan. Illustration: TBS

In January of this year, Royal Bank of Canada Chief Executive Dave McKey said they were struggling to recruit talented, qualified and capable employees. Banking jobs have always been highly coveted by applicants.

But as technology companies redefine our society and our business practices almost daily, banks are failing to attract qualified candidates, especially in sectors such as information technology, artificial intelligence, machine learning , mathematics and software engineering.

This shortage is seen not only in Canada, but also in the United States. As North American banks are at the heart of global finance, their problems often foreshadow the challenges that developing economies will face in the near future.

Like any other developing country, Bangladesh already has its fair share of tech start-ups, some of which have produced excellent results. Other companies will soon follow their path, gobbling up what little skilled labor the country currently has.

Accordingly, banks in Bangladesh need to identify their relationship with technological changes and decide on a path for the acquisition and development of human resources.

In the era of the Fourth Industrial Revolution, technology has touched all areas of business and finance. Automated Teller Machines (ATMs), Internet Banking, Electronic Funds Transfer, and Telephone Banking have changed the skills needed to be a permanent bank employee.

As a result, banks have turned to hiring more tech-savvy workers and implementing training programs to fill the gaps.

Employment and e-banking increased simultaneously in Bangladesh. Consequently, employees in the banking sectors in Bangladesh feel that their jobs are secure, at least compared to other developing countries.

This is mainly the result of political decisions by our banks themselves. In addition to focusing primarily on automation, they have tried to make banking services more convenient and accessible for customers, thereby creating new positions within banks. Even when employees were replaced by automated machines, they were often held back and assigned to different jobs.

Nevertheless, it has been found in various studies that a change of environment or restructuring can lead to job security problems. As a result, employees can look for alternative jobs. Canadian banks are already struggling to retain their employees, as many have chosen to retire early.

So, in addition to hiring new qualified employees, banks may also find it difficult to retain the employees they have. Banks must also prepare their employees for rapid technological changes at the same time.

Illustration: TBS

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Illustration: TBS

Illustration: TBS

Fortunately, most of the employees currently working in Bangladeshi banks are either very young or middle-aged. Both demographic groups who can easily adapt to an ever-changing workplace.

But to get the most out of these people, banks will need to train them regularly. The majority of employees surveyed in a study felt they needed training for Internet banking, electronic funds transfers and telephone banking, indicating that they feel the need to change.

Training and skills development are extremely important in the face of emerging technological advances. They decrease job ambiguity and skill obsolescence, providing job security.

The good news is that the number of banks and the number of bank employees in our country are both on an upward trajectory, demonstrating that there has been no significant downsizing. Another positive aspect is that banks take care not to be overstaffed, which is also an important aspect of human resource management.

Technology can make some jobs obsolete, but it is also creating new positions, as evidenced by the growing need for account managers to guide customers through their payment activities.

High staff turnover is undesirable for any financial organization. Without dedicated employees, banks will see a decline in confidence. Additionally, service delivery will not remain consistent at all levels, leading to a potential exodus of clients.

Banks now need to introduce social benefits for their employees to give them more incentive to change and acquire new technical skills, which will increase the productivity of their businesses. It will also inspire loyalty, helping banks retain the talent they already have.

Banks must now anticipate likely technological developments in the sector and keep their employees up to date through training and retraining programs. A recent study revealed that across all age and gender groups, employees lean towards the importance of training. This means that employees are already aware of the changing business structure and are prepared to remain employable.

Additionally, banks need to hire technical experts who will guide businesses through a rapidly changing technology scene. They can advise on technology adoption, employee best practices, and training courses. These experts will also help banks identify and capitalize on untapped revenue streams.

It is also recommended that the banking community and practitioners understand that in addition to training, they will also need to focus on soft skills development and integrity monitoring to foster a culture of high employee performance and positive attitude.

Last but not least, a meritocratic mindset, involving sympathy and trust, is absolutely necessary to create encouraging conditions for banking talents to learn and grow. Otherwise, banks may have to fight technology companies to hire the necessary talent, which will not be a desirable outcome for all parties involved.


Md Kafi Khan is the Corporate Secretary of City Bank Limited.


Warning: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions and views of The Business Standard.

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