The new approach includes putting more emphasis on the value that a company brings to the bank, rather than just its size, in order to build up the number of active transactional accounts.

Vipon Vorasowharid, first executive vice president, said SCB had made a strategic adjustment to bring the bank’s main loan portfolio down from Bt300 billion to Bt270 billion, as it had moved its SME (small and medium-sized enterprise) portfolio of more than Bt30 billion to its small-business unit.

The unit is headed by Pikul Srimahunt, who is also in charge of mortgages.

SCB’s small-business unit had a loan portfolio of Bt50 billion prior to taking on the additional Bt30 billion.

SMEs with annual turnover of no more than Bt75 million will be overseen by the unit.

While the bank needs to use relationship managers (RMs) to service SMEs and wants to expand its customer base, the current number of RMs might not be sufficient to |service small SME clients, the executive said.

Each RM looks after 200-300 enterprises, which means that in the long term they will find it difficult to expand the customer base.

SCB therefore decided that it needed a service centre and “hunter” staff to service small SMEs, he said, explaining that the hunters would acquire new customers and transfer them to the service centre – a system that would speed up the lending process.

Vipon said the bank realised that being the main operating bank in the segment was more important than chasing lending to more up-scale customers, as in the past, with lending used as the leading product to acquire transactional accounts.

“Today, the way of doing SME lending business must change. We are not so seriously concerned about building the portfolio and, under the five-year plan of the Business Banking Group, we want to see more active transactional accounts. Our active accounts should account for 25 per cent of our total SME clients,” he said.

Active transactional accounts at SCB currently stand at 10 per cent.

“We will not benchmark SME business in terms of outstanding loans, because more lending [to the segment] could mean more non-performing loans. We will benchmark SMEs in relation to their usage of the bank, as per their statement accounts,” he added.

Importantly, customers will be serviced on the basis of their value to the bank, not on their size, Vipon said.

For example, a small enterprise could have more value than a large business despite having a smaller loan, if it uses SCB as its main bank, he said.

The bank has therefore found it crucial to evaluate the value of customers in order to treat them better, he stressed.

While revenue of the Business Banking Group might not grow, value to the bank will increase as the deposits of those customers that stay with SCB for making transactions will help reduce overall costs, he said.