Mongolia's best domestic bank 2019: Khan Bank
No financial institution better traces Mongolia’s event-rich journey from herding and farming hinterland to thriving frontier economy than Khan Bank.
Founded in 1991 to serve the nomadic population for which the nation is famed, Khan Bank is Mongolia’s biggest lender and has been at the core of its economic development. And, arguably, it is ‘exhibit A’ of the country’s ambitions to move up the value chain in a global economy driven by ideas and innovation.
Khan, it is worth noting, was the first to place ATMs out in the steppe. It offered the first automated, 24/7 transaction centres and digitally driven multi-purpose kiosks. It is not just a pioneer of mobile banking, but a disruptor in a nation that needs to raise its technological acumen. It serves more than 2.4 million of Mongolia’s three million people. Some 1.7 million of them are Khan cardholders, and the bank has nearly 56,000 corporate customers.
For this, and for its continued robust financial performance in trying times, Khan remains an easy call for our annual best domestic bank award.
Equally important is where chief executive John Bell and his leadership team are taking Khan. A veteran of the Royal Bank of Scotland, ABN Amro and Citigroup, Bell exudes an institutional wanderlust matching that of the Mongolian nomads of popular imagination.
From its humble roots as an agricultural lender, Khan has increasingly ventured into digital banking. It now accounts for some 40% of all e-banking and 88% of mobile transactions. Khan is also moving aggressively into payments.
Khan’s current obsession is improving its application programming interface (API) to make transactions easier, faster and safer. The idea is to develop new apps for customers dialling in, whether from the skyscrapers of Ulaanbaatar or the farthest reaches of the Gobi desert.
At the moment, it takes customers roughly 11 seconds to check their balance and 256 seconds to complete a transaction. Not fast enough for Bell’s team, which is in a hurry to get those average times down.
Khan is focused on supporting the small and medium-sized enterprises crucial to the nation’s progression. At the end of June, its SME loan portfolio was worth Tug1 trillion, or about $370 million. The potential for growth in Mongolia is obvious – and Khan is the obvious beneficiary.