There is considerable debate about Discovery\u2019s entry into banking, but the company has made it clear that it wants to disrupt the established market.<\/p>\n
This is according to the bank’s CEO, Adrian Gore, who said that there are currently two main questions surrounding Discovery’s entrance into banking.<\/p>\n
“First, our approach to differentiation is, ironically, to do nothing differently \u2013 we are following our business model to a T,” he said.<\/p>\n
“Our core purpose is \u2018to make people healthier\u2019 and this has led us to understand that within the most complex matters of life, death and money, there is a common strand \u2013 behaviour.”<\/p>\n
Gore said that just four poor lifestyle choices are responsible for 60% of the world\u2019s preventable deaths and 80% of the disease burden.<\/p>\n
Similarly, five driving behaviours explain 60% of fatal road accidents; and five simple financial behaviours explain 80% of credit default risk and why people don\u2019t have sufficient retirement savings.<\/p>\n
“Our approach is to use incentives to change irrational lifestyle choices, using technology as an enabler, and integrating this into financial services,” he said.<\/p>\n
“We have created a shared value cycle that is good for our customers, us and broader society \u2013 and globally relevant.<\/p>\n
“Because of this we have built Discovery Bank on the same architecture and termed it a \u2018behavioural bank\u2019 because it uses incentives to change financial behaviours. This is different to existing loyalty and reward structures.”<\/p>\n
Why now?\u00a0<\/strong><\/p>\n Gore said that Discovery was started in 1992, during the transition period from apartheid to democracy.<\/p>\n “I recall the Boipatong and Bisho massacres \u2013 it was a time of considerable uncertainty,” he said.<\/p>\n “We learned from this that it is during difficult times that one should build because others are distracted, and opportunities are undervalued.<\/p>\n When good times emerge, you are then in full stride, said Gore.<\/p>\n “The Warren Buffet statement, ‘Be fearful when others are greedy and greedy when others are fearful’ refers to wise investing, but it applies even more so to the building of businesses.”<\/p>\n “There is no conceit in our entry to banking, rather confidence in our purpose and model, respect for our competitors, and importantly, belief in our country, Gore said.<\/p>\n
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