Sberbank - Annual Report 2010 - Accessibility of Banking Services

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# Accessibility of Banking Services

## Ensuring the Accessibility of Services across the Country

Sberbank provides banking services across all regions of the Russian Federation to all social groups, including in regions with small populations or a low level of economic development. According to our classification, such low-population areas include 24 regions of the Russian Federation with an average population density lower than the national average.1 Regions with a low level of economic development are defined as those where monthly average income per capita is lower than the national average.2 According to our estimates, there are 63 such regions in Russia.

In modern society, access to financial services is a basic individual need and a necessary condition for the economy to function. We work to provide residents of all Russian regions with equal access to Sberbank’s services.

| Availability of services (thousand residents per Sberbank service centre), 1000 people | Sberbank share in the total number of banking service centres in the region, %
--- | --- | ---
National average | 7.46 | 50
Regions with low level of economic development | 6.86 | 57
Low-population regions | 8.99 | 49

## The Development of Remote Banking

Sberbank currently views the development of remote banking services as an important component of its strategy to improve the accessibility of services. The Bank actively develops and promotes products such as Sberbank Online and Mobile Bank. The use of remote banking services not only helps our customers save time but also makes the Bank’s services accessible to those who would otherwise be unable to make use of our services.

In 2010, the share of customers using our remote banking services reached 41%, a 3 percentage point increase on 2009. More than 57% of banking operations, including almost 35% of payments, are made via remote channels. In developing our remote banking systems, Sberbank also looks at opportunities and makes preparations for the implementation of a platform that will allow electronic invoices to be sent between businesses and government authorities. The use of such a platform will capitalise on the opportunities opened up by recent amendments to the Tax Code of the Russian Federation.

Sberbank Online is a package of online web-based banking services available to retail customers. The system allows customers to perform a broad range of card and account transactions and obtain information about the status of loans, as well as prepare transfer orders, collection orders and other payment documents. The convenience and mobility of the service, combined with a high level of security, have made it popular among our customers: by the end of 2010, the number of service users exceeded 7.5 million.

The Sberbank Business Online system was developed specifically for small businesses. The system is inexpensive, easy to use and meets the needs of small businesses and individual entrepreneurs, allowing them to track payment documents, store the bank details of relevant organisations and import and export documents formatted in accordance with 1C, a popular accounting and business software suite.

Mobile Bank is a package of services available to cardholders through their mobile phones. Customers can receive SMS notifications on card transactions, check the status of their accounts, block their cards if necessary, manage payments and transfers from their accounts (with certain restrictions) and make payments on loans. The Auto-Payment option allows customers to set up automatic payments to top up their mobile phones. As of the end of 2010, more than 22 million customers used the Mobile Bank Service.

Sberbank is actively expanding its network of self-service terminals, which in 2010 included some 28,000 ATMs and more than 17,000 information and payment terminals. These terminals and ATMs allow customers to perform the most common types of transactions easily and without having to visit a Bank service centre. Customers are able to withdraw and deposit cash, make transfers and pay for utilities, communication services, Internet access and satellite TV. Many self-service terminals allow customers to make cash payments in addition to card transactions.

## Self-Service Terminals at Public Transit Stops

In 2010, the Severny Regional Bank installed six self-service terminals at public transit stops in Yaroslavl, Cherepovets and Veliky Ustyug. Such terminals allow people to pay utility bills, easily perform common account transactions and make loan payments, helping customers save time and effort.

## Improving the Affordability and Transparency of our Loan Products

In spring 2010, in an unprecedented step for the Russian banking industry, Sberbank abolished all commission fees on retail loans. This meant that interest payments remained the only type of fees paid by individual customers on their loans. Sberbank was the first Russian bank to take such a step to simplify and make more transparent the pricing of loan products for its customers.

In 2010, we continued our programme to restructure the debt of those retail customers who found themselves in a difficult financial situation due to reduced or lost income. The Bank made it possible for certain categories of individual borrowers (those serving in the army or on parental leave) to be granted a deferral on payment or a reduction in monthly loan payments. Those with overdue payments were given the option to negotiate a tailor-made payment schedule. We also developed a scheme to restructure debts for individuals affected by the fires in the summer and autumn of 2010. During the year 2010 we restructured about 15,670 loans. As of January 1, 2011, the aggregated sum of outstanding restructured loans was RUB 6.82 billion. In addition, to support customers with overdue debt on their credit cards, Sberbank began to develop a programme to restructure this kind of debt through the provision of a consumer loan on preferential terms. The full-scale implementation of this programme is planned for 2011.

1,2According to Russian Statistical Yearbook 2009.

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