reasons for this. One was economic: ‘Muslim people in France are on small wages. They cannot afford banking services.’ The second was a cultural point. France’s integrationist social model deems every citizen to be French, so theoretically all should be content with the one banking model. Therefore, ‘I wonder if French banks are embarrassed with proposing such offer to a niche market’, he said. SAB wasn’t the only French vendor known to be working on Islamic banking at this time, with Delta having released details of its own Islamic product in April. SAB was also working on other improvements within its suite, including the introduction of analytical accounting and structured finance modules. By early 2010, SAB was also planning to offer its solution


on a Software as a Service (SaaS) basis, working with IBM. A pre-configured version had come out of work with Financière Océor and this would be used as a template for the new hosted offering. The solution was touted for availability in April, said Schintowski. ‘We know the market is waiting.’ He felt demand was likely to come from banks and credit institutions. The offering comprises SAB’s full system but with the ability to take portions of this, for areas such as credits, payments, savings, accounting/reporting and securities. The latter element is provided by Samic. IBM is a long-standing partner of SAB and has been proactive in the French market with SaaS. It has an association of partners (vendors, consultants and service providers) for this and for cloud computing, dubbed Le Club Alliances. One IBM partner, Aspaway, was also expected to work with SAB, possibly providing front office solutions as well as services, but this was not an exclusive arrangement, said Schintowski. Océor was looking to set up its own pre- configured version for six operations in French-speaking countries and worked with SAB on this. SAB negotiated the rights to use this version as the template for its own SaaS offering. The Océor-derived pre-configured solution is also intended to be used to speed up traditional implementations and SAB was also talking to a number of consultants in France to provide related services. SAB was hopeful that the SaaS model might also be


attractive in Islamic banking, allowing banks to test the water with this form of banking. SAB had initially claimed a first Islamic banking recruit lined up in Algeria (the aforementioned North African green-field site). This was a subsidiary of Caisse d’Epargne, but ultimately it did not receive central bank approval.


However, by this stage, SAB had a first taker in Iran in the


form of Karsazan Ayandeh, a credit institution with around 300,000 customers and 140 branches, which was moving to


364


become a full bank. The deal was gained in the middle of 2009 through a local partner and Karsazan Ayandeh was expected to be a first taker for the Islamic functionality, alongside the traditional version. The project started in October 2009 and was due for completion around the end of 2010. The addition of Farsi language support was one part of the project, with the local partner lined up to help with this. Interestingly, the complexities of the Iranian market had caused Delta Informatique to pull back from a deal a couple of years earlier. Karsazan was planning 200 branches and 500,000 customers within a couple of years, 500 branches and one million customers in five years. The selection included some benchmark tests. SAB AT was being implemented on a high- end HP server. The project at the bank has, predictably, moved at a slower pace than planned but there has been progress. Whilst the doors to the Iranian banking market might be shut for some suppliers, there is an opportunity for others. SAB views it as ‘strategic’, said Ryta El Khoury, regional sales executive at SAB, in March 2013. ‘Iranian banking is in major need of an international banking package. This need has been expressed throughout our contacts with the different banks and financial institutions in the country.’ By this stage, Karsazan Ayandeh had around 300


branches, 800,000 accounts and 800 employees. El Khoury said the institution planned to increase its client base to one million within a few years. It had been a challenging project on many fronts, she admitted, including the lack of experience on the customer side in dealing with such complex migrations. Nevertheless, she asserted that the roll-out was progressing well and according to the set schedule (although there was a delay of a few months in the implementation of the HP servers), and by this time 26 branches were running on SAB’s platform. ‘It was impossible to plan a full big-bang scenario because the branches were not all connected,’ she explained. The first go-live took place in mid-2011, at four locations. Gradual migration of the entire branch network was underway, in parallel with an upgrade to the newer SAB AT version of the system. According to El Khoury, the most significant adaptations


for Karsazan Ayandeh concerned the integration, within the Unix version, of the Solar Hijri calendar (the official calendar of Iran and Afghanistan) for day-to-day calculations, the application of ratified profit rates to credit or savings periods, the availability of right-to-left screens and the application of the Persian language. ‘Iranian banking has lots of specifics and the penetration is extremely challenging for many core


Universal Banking Systems Market Report | www.ibsintelligence.com


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