Oracle Customer Success — Khan Bank

Khan Bank

Khan Bank Ensures Smooth Banking Operations, Improves IT Team Productivity by 40%, Enhances Customer Satisfaction, and Supports Growth

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We chose Oracle Exadata because it offered a pre-engineered, single vendor solution for hardware and software, enabling us to restore data 4x faster, accelerate customer transactions, increase IT team productivity by 40%, enhance customer satisfaction, and support rapid growth. In addition, only Oracle Platinum Services could provide the remote monitoring services we required to ensure high system availability, minimize risk, and maximize our IT skills.

— Arvind Joshi, Director of Information Technology, Khan Bank

Established in 1991 as the Agricultural Cooperative Bank, Khan Bank is Mongolia’s largest commercial bank and provides comprehensive banking services, including cash deposits, credit cards, loans, ATMs, internet, and mobile banking, to individuals and midsize companies across the country. Sawada Holdings, the bank’s majority shareholder, acquired, restructured and privatized the bank in 2003, changing its name to Khan Bank in 2006. Today, Khan Bank operates 530 branches and holds approximately 70% retail-market share and 25% corporate-market share. It is also a major provider of payment services—such as salaries, pensions, and social welfare payments—as well as foreign exchange, trade finance, cash management, and international payment services. 

With strong growth in the Mongolian economy over the past four years, Khan Bank experienced substantial year-over-year growth in its banking business. This included more than 100% growth in internet transactions, a 70% increase in mobile and an 84% boost in point-of-sale (POS) transactions. The bank’s legacy hardware platform struggled to handle the growing volume of transactions, causing frequent system downtime, disrupting critical daily banking services, and increasing customer frustration. Khan Bank also wanted to expand its services, such as internet banking, to customers in remote villages and sparsely populated regions. In addition, an acute shortage of skilled professionals in the country also challenged the bank’s ability to support new IT infrastructure and provide smooth banking operations.

Khan Bank implemented Oracle Exadata Database Machine to provide a high-performing, reliable, and scalable database platform for its core banking applications and support business growth. It now restores data 4x faster, processes batches five hours faster, and enables customers to rapidly conduct transactions without disruption, ensuring greater customer satisfaction. With Oracle Platinum Services, Khan Bank also improved DBA productivity by 40%, ensured high system availability, minimized skills-shortage risk, and increased staff confidence and morale.
  • Restores Data 4x Faster, Increases Service Efficiency, and Enhances Customer Satisfaction
    The Mongolian economy has expanded rapidly since 2011, realizing an approximate 10% average annual growth. Khan Bank experienced corresponding transaction growth across its various banking channels, such as ATM, POS, internet, and mobile banking. As the bank’s legacy hardware platform neared end-of-life, the bank experienced up to 70 hours of service outages quarterly, which inconvenienced customers, particularly rural dwellers and nomadic herders, and led to customer complaints. 

    By migrating five business-critical databases—namely core banking, credit card, general ledger, internet banking and mobile banking—to a pre-tested and pre-configured Oracle Exadata, Khan Bank can restore data up to 4x faster and complete batch processing five hours earlier—finishing each day at 3 a.m. instead of 8 a.m.—enabling the bank to provide full banking service to customers, even remote villagers, with minimal disruption. It also allows customers to rapidly process online transactions at any time through internet and mobile banking, which has significantly increased customer satisfaction.  Oracle Exadata’s Smart Flash Cache technology also enables Khan Bank to complete data backups 3x faster, ensuring security for critical banking transactions, such as loan repayments and cash deposits. 

    “Customers these days are more mobile and expect 24/7 banking services, so system downtime is simply not an option. Oracle Exadata’s completely redundant hardware protects against database failure and site disasters, and ensures high system availability. This enables us to complete more customer transactions across all channels, and has increased business revenue,” said Arvind Joshi, Director of Information Technology, Khan Bank. “Oracle Exadata makes a big difference to our banking business, enabling us to minimize risk and enhance our brand image.”
  • Ensures High Availability and Improves IT Productivity by 40% with Remote Support
    In the legacy hardware environment, DBAs had to manually identify and diagnose system faults when they occurred. They then notified the vendor, who would send a partner to fix the problem. This reactive-support model delayed issue resolution and negatively affected system availability. It was also time-consuming for DBAs to deal with complaints, both from internal staff and external customers, which prevented them from working on more valuable tasks, such as application development. 

    Using Oracle Platinum Services’ 24/7 remote monitoring for Oracle Exadata enables Khan Bank to automate service requests for hardware failures and rectify issues quickly, ensuring high system availability. Oracle Platinum Services also works with Khan Bank’s IT team to apply quarterly patch updates, allowing the bank to provide best practices for system configuration. This has reduced DBA workload by 40% and eliminated the need to hire additional staff members. DBAs now have more time to focus on strategic initiatives, such as developing anti-money laundering and custodian applications. 

    “Oracle Platinum Services is phenomenal. The team’s response to fault alerts is so fast that we often resolve hardware issues even before users are aware of them,” Joshi said. “This is a huge benefit to us, particularly since there is limited Oracle expertise in Mongolia, and it ensures our peace of mind.” 

    In addition, with relatively few proficient English speakers and minimal training opportunities in the country, retaining skilled IT professionals is critical to Khan Bank. Oracle Exadata and Oracle Platinum Services have helped the bank to minimize the risk of skills-shortage by enabling it to train its database administration team with the skills required for the new infrastructure, instead of hiring new headcount. This, in turn, has enhanced staff confidence and boosted morale.

    "With the greater efficiency, we had the option of downsizing our IT team. However, we took a different view, as we wanted to maximize the skill of our existing staff, and this has directly contributed to the bank’s overall performance improvement,” Joshi said. 
 
Challenges
  • Replace and upgrade legacy hardware environment to support banking transaction growth and enhance customer satisfaction 
  • Improve performance and reliability of core banking applications and enable the bank to provide multi-channel banking services to customers even in remote villages
  • Increase revenue opportunities
  • Adopt remote, self-monitoring support service to minimize skills-shortage risk and improve IT team productivity
Results
  • Ensured smooth banking operations by implementing a high-performing, highly available, and scalable Oracle Exadata Database Machine to eliminate 70 hours of downtime quarterly, enabling customers to process transactions such as government welfare payments at any time 
  • Supported transaction growth across banking channels and increased business revenue by migrating five databases for critical banking applications to a single Oracle Exadata
  • Restored data 4x faster and completed batch processing five hours earlier, boosting customer satisfaction 
  • Reduced DBA workload by 40% by using Oracle Platinum Services’ 24/7 remote monitoring to automate service requests for hardware failures and accelerate resolution time
  • Freed IT staff to focus on strategic initiatives, such as developing new banking applications 
  • Backed up data 3x faster and enhanced data security for critical banking transactions, such as loan payments and cash deposits, thanks to Oracle Exadata’s Smart Flash Cache technology
  • Enhanced brand image by using Oracle Exadata and Oracle Platinum Services to ensure high system availability and enable the bank to provide comprehensive services to customers, even in sparsely populated areas
  • Adopted best practices and optimized system security by working with Oracle Platinum Services to apply quarterly patches 
  • Minimized skills-shortage risk and improved DBAs’ confidence and morale by increasing their knowledge and proficiency thanks to Oracle Exadata and Oracle Platinum Services

Why Oracle

Khan Bank was already using Oracle Database for its core banking applications and chose Oracle over other vendors because of its engineered system approach and willingness to commit resources in Mongolia. In addition, only Oracle could offer the remote monitoring support services that Khan Bank needed to address its unique geographic and personnel challenges.
 

Oracle software simply runs best on Oracle hardware. We were confident that Oracle Exadata could provide the performance, reliability and scalability we required to support our critical banking operations and future growth. We were also very impressed with Oracle Platinum Services. It certainly differentiated Oracle in the marketplace, because other vendors keep talking about offering remote monitoring, but only Oracle actually delivers it.

— Arvind Joshi, Director of Information Technology, Khan Bank

Execution

With assistance from ITZone, an Oracle Partner, Khan Bank received and installed Oracle Exadata on time and on budget. Oracle also provided fast response to service requests, and quickly resolved issues during the implementation process.

“We learned that it’s important to follow Oracle standards and guidelines to avoid pitfalls and ensure rapid installation,” Joshi said.

About Khan Bank

Headquarters

 
Ulaanbaatar, Mongolia

Annual Revenue

 
Under US$100 Million

Partners

ITZone LLC
Published:  May 06, 2015