LIVE FROM MOBILE ASIA EXPO 2014: The threat of disruption that comes from new service models – and how an incumbent responds to them – was the theme of the keynote by Raja Teh Maimunah (pictured), MD and CEO of Malaysia’s Hong Leong Islamic Bank.

“I have been a banker for more than 20 years and in the last three years we woke up and have seen a lot of people getting into our business,” she said.

Maimunah delivered a brief history of how mobile and digital technology has disrupted conventional banking.

“It’s heartbreaking because we spent a fortune on our branches and now people are saying ‘we don’t want to go to our branches to do financial transactions’.”

The banks face a huge shift, not just in resources but mindset too. “We are dinosaurs,” she admitted.

Financial institutions are experiencing disruption from non-bankers such as Alibaba, which manage money from users not just accepting payments.

Challengers – actual or potential – include internet companies such as Facebook, as well as mobile operators such as Vodafone.

Some banks have already responded by creating their own digital outfits including Commerzbank, mBank, UBank and National Australia Bank.

“What we have learnt is we have to differentiate ourselves.”

In its home market, Hong Leong Bank has set up its own digital sub-brand called Connect. “So people will not see us as an old, traditional boring bank, you are young, funky and new.”

The bank also launched a new digital banking service in 2012 called Mach that evolved reworking its branch network. The idea is to create a new customer experience. “Detach the new banking solution from mother bank,” she said.

To accompany the move, the bank came up with a new service that seemed to symbolise the change: a new P2P service that enables users to send funds to one another using only the recipient’s mobile number.