Robin Bairstow is the new I&M Bank chief executive officer, taking over from Sanjiv Anand who resigned at the end of last month. Bairstow has experience spanning over 20 years in the banking industry. The New Times Peterson Tumwebaze caught up with him last week and he outlines what he will bring to the local banking sector:
What should I&M Bank customers expect from you and what do you bring to the banking industry?
I have been in the banking business for the last 25 years, and have worked in more than 15 countries during that period. I have also worked in the logistics industry and I was a navy officer before joining the financial sector.
So I have vast experience in business management and administration besides banking, which should give shareholders and customers confidence that the bank will continue to grow and bring innovative products that suit their needs on market.
I plan to continue aligning products and services with the national economic development goals. I am proud to contribute, not only to the vision of the bank, but also to that of the country as well.
I&M Bank is one of the institutions with a solid capital and asset base, as well as an innovative and strong team which has already done a wonderful job growing the bank at an impressive rate.
These will come in handy as the bank continues to invest in digital platforms and electronic banking facilities, which I believe are the future of the banking industry.
My job is, therefore, to sustain what has been achieved and double revenues in the next five years, especially by plugging loopholes that expose us to risks. The bank will continue supporting corporate financing and providing credit and guidance to the small-and-medium enterprises (SMEs). We will also work to support the country’s growth agenda so that Rwanda remains one of the fastest-growing economies in the world.
There has been a push for a cashless economy by government and your bank, what is your take on this?
We have registered a 300 per cent growth in electronic banking and systems that support a cashless economy. I believe there is more that we can do, especially offering competitive pre-paid cards.
It is essential for the banking sector to promote e-banking and other electronic facilities, like use of credit/debit, including Visa and other cards, so that clients can understand the benefits and embrace them. This way, the sector will be able to reduce the cost of transactions and boost cashless economy.
Many banks lack innovative products, which affects growth of some sectors, like SMEs. How will you address this challenge?
SMEs are a major catalyst for growth and the largest employers in any economy, which should ideally attract banks to support them. Unfortunately, when they apply for bank loans, they are asked to present collateral which the majority do not have. I will, therefore, work with my colleagues in financial industry to try and find solutions to the challenge.
SMEs do not benefit from the several small tenders in local governments because they lack financial capacity.
Therefore, we have to create products that support the SME sector to participate in the tendering process, including providing guarantees, for the country to fully benefit from their potential.
The industry also needs to look at practical ways they can support start-ups since most new business operators do not have collateral.
Borrowers have complained about high interest rates, but bankers seem to have kept a deaf ear. What should be done to cut interests rates?
The primary issue that commercial banks face is the underlying cost of finance. We have to understand what is driving that cost and look at customers’ commitment to pay.
It is important for borrowers to understand that credit discipline determines rates. Bad borrowers are shunned or subjected to high rates. However, sector players together with the central bank and finance ministry are working together to see how the rates can be reduced. Besides, we should be working to bring down the interest rates as an industry to promote financial inclusion. Banks have to put extra efforts to educate borrowers on loan management and financial discipline so that borrowers use funds for activities they were intended and then pay back. When loans are not repaid, this will hold back lending and affect economic growth.
What are your plans on mortgage financing?
Mortgages and financing affordable housing are some of the areas we would like to prioritise. I believe that we have a number of products that can help us realise this objective. This is because provision of decent housing is key to support Rwanda’s development. So, the banking sector should increase access to mortgage finance and develop products targeting housing sector to address this issue.
I&M Bank is already working on an initiative (which will be unveiled next month) that should help address this challenge going forward.
How should local banks position themselves in the region?
Regional integration is about trade and movement of capital, people and investments. Besides, the more trade opportunities you have the more business opportunities for banks.
Therefore, banks should position themselves in a way that makes it easy for them to support cross-border initiatives and trade besides creating linkages with regional companies coming to invest in Rwanda.