"In the fast-paced modern world of rapidly commodifying banking products, the features of which remain relatively similar, smart strategies are the single most powerful way to gain a competitive edge. For a leading Georgian bank, with significant initiatives and unprecedented banking products up its sleeve early on, rapid short-term growth at the crossroads of East and West could have been easy. But Bank of Georgia took the high road, emerging as a regional leader among the top digital banks in the world," - this is the lead of the story on Bank of Georgia, which has been featured by TechCrunch brand studio. Giorgi Isakadze conducted an interview with the CEO of Bank of Georgia before all these changes in ministers and Business Ombudsman took place. However, the CEO of the leading Georgian bank seems to be satisfied with the economic growth and recent figures.
Archil Gachechiladze: 2021 was much better than we expected. We expected high single-digit growth and it turned out to be more than 10 percent. It was a bit high inflation, but overall it was the year of small and medium businesses waking up, customers feeling a bit more assured. Consumer borrowing was pretty strong. So overall, it was a year of recovery and the recovery happened a bit better than we expected originally.
Giorgi Isakadze: But recovery in regards to SMEs, right?
Archil Gachechiladze: Yes. Small and medium businesses were the drivers of the economic recovery. We also see consumers feeling a bit more reassured. Part of the economy where we still believe that recovery needs to be seen is small and medium hotels, especially in Tbilisi, because in the regions there was still internal tourism that more or less provided some income. But the small and medium hotels in Tbilisi are still having a hard time and hopefully, in 2022 we will see awakening there. Besides this, something that we are very happy about as a whole team of 7,000 people is the net promoter score. So, our customers are demonstrating that they are happier with our products than in the past. Here we saw going from NPS of 27% four years ago to 55%, which is very quick growth. Our partner Medallia - a supplier of software which learns what our customers want, is the best in the world. They said that they've never seen such huge growth. In fact, Medallia is doing a worldwide case on us. This is something that takes a cultural change within the organization- for all of our employees to understand that customer is very important.
Giorgi Isakadze: Taking into consideration tourism statistics that we got just a few days ago, are we going to have the same, strong growth in 2022? We need your predictions in this regard as well.
Archil Gachechiladze: Life economists say, you know, "all things being equal." If we don't have a geopolitical crisis, which I hope we will not have and everything will be resolved peacefully, If the pandemic ends, which is something that I believe Omicron will do, I think we'll have more growth than we currently expect. January tourism numbers show that people are waiting to travel the moment everything is open. So I think Georgia will benefit proportionately.
Giorgi Isakadze: 900 020 unique users through your mobile application and 1.6 Six million in general. These are December figures. There is a unique application feature that you launched just a few weeks ago. Tell me about this opportunity and what it presents for any citizen, any customer of Bank of Georgia, who can become a trader in 5 minutes.
Archil Gachechiladze: The worldwide trend is clear that retail investors want to have low-cost access to owning different shares in global companies. I think in Georgia, we didn't have that product. We did have a separate app, but it was more tailored for technically savvy investors. This is more of a retail product, so not only is it low cost, it's very easy - user interfaces wise, it's very easy. It also provides fractional trading. So you can, instead of, let's say, investing 200 000 dollars for a particular share and some of the shares are very expensive, you can buy one-hundredth of the shares. So you buy for ten dollars, you buy for fifteen dollars, you buy for twenty dollars - you buy for a small amount of money, a fraction of the shares that are being offered there. Not all shares are offered there, but all the major corporations are. So basically that provides a low-cost, retail-oriented ability - a window to the investment world, which in this case is the U.S. and Europe will be added just in a couple of months.
Giorgi Isakadze: My final question goes back to the Georgian economy. Your predictions for 2022 are clear. It's been a stable exchange rate for the Lari for the past 5 months. Where do you see the reasons for the stability and how do you see 2022 in this regard?
Archil Gachechiladze: When we look over the last four or five years of relative instability, we realize that this full year has been refreshing. So, it's welcoming news for our investors. Going forward, overall, I think the focus has been on de-dollarizing the deposits as well as loans. Focus has been on deposits. I think that this strategy will serve Georgia very well in the long run as it should support the stability of Lari. This will create an environment where people feel safer saving in Lari, especially given the interest rate differential which has been incentivized by the regulation between dollars and lari. Lari became more attractive for saving. This should serve the country very well in the long term and de-risk the dollarization with minimal effect on the currency exchange.
