What role does online banking play in your operation?
In order to have new channels of access, we are developing services for mobile devices. This will reduce our costs, make us faster, and make our service available across the country. Internet is not always available large cities, like Bogotá, Cali, and Barranquilla. People are shifting away from the old way of doing transactions, but they need time to transition. Internet penetration in rural areas is also growing, as the Minister of Technology is working to give coverage to the entire country. Working with the technology and education areas and the other ministers is important to us. Having access to cell phones and mobile data is also a critical advantage. On top of that, clients need a bank and an institution. About 60% of our costs in transport are incurred because we transport money by airplane or helicopter. It is difficult for us to be so spread out, but clients need money to conduct transactions. This means we can generate value through reducing the use of cash, but we need the infrastructure to meet that goal. Our goal is to reduce the use of cash and then be available in other channels, not just with our branches and offices, but also with the mobile bank, the e-wallet, ATMs, and all the other ways we can be available to customers.
What role has the bank played in boosting financial inclusion here in Colombia?
The two most important issues to us are bank inclusion and agricultural insurance. In that way, we are working in insurance for agricultural products, which is still low. We need to make a huge change in the use of insurance because people do not understand the importance of being covered. It is perceived as just another cost, not an investment. To this end, we are working with all the educational processes at our disposal, and we are incentivizing these products by reducing the interest rate. Home insurance is mandatory in Colombia, but not in agriculture. With inclusion, it is also important to educate people and show them why it is important to have access to formal credit, which is not easy. In many places they have informal credit at the store, with their friends or their neighbors, and so on. The interest rates may be high in these instances, but they get the money quickly and easily. Banks are perceived as more complicated. So we are working on making bank access very easy.
What is your outlook for the agricultural industry for the coming year?
For the agricultural sector, the outlook is above average. In some segments such as flowers, bananas, or coffee, the devaluation of the peso had a positive effect and increased their income. But for other sectors, like pigs or cattle, which need food imported from other countries, the devaluation of the currency was negative. The overall outlook for the agro industry is positive. The government needs to work with all major agricultural institutions and focus on issues where we have a competitive advantage, and we need to increase our production in order to be a supplier for the Colombian people and the global market. We were a major agricultural player in the region, but now we are almost at the end of the line, so we need to catch up. We need to be specialized and define what we want to have. Until 1990, coffee was the main driver. The most important thing is to define what we want to do next. In that way, the ministry is working with the planning area for the agricultural sector. Our bank will be aligned with the agricultural planning. There will be credit for everyone in every product, but the support from the government for agricultural institutions must be aligned with one policy in order to have long-term development.