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New Customer Acquisition

As in most consumer-lending organizations, portfolio growth was driven by a combination of “new-to-bank” customer acquisitions (direct sales–led) and deepening relationships through cross-selling. The majority of new customers were gained through door-to-door sales, a model similar to the one insurance agents or financial planners used in the United States when they invited people to meet at a coffee shop or office for an information session. Several departments worked together to ensure that the right strategy was put in place for new-to-bank customer acquisitions. The team managed a very sizable group of relationship managers whose core focus was acquiring new customers.

The cost structure for booking a new loan, credit card, or insurance policy depended on the channel used to gain the business. There was a one-time booking cost for each customer. If the service was booked through a relationship officer in a Dunia branch or through a door-to-door sale by one of Dunia’s 1,000 salespeople, the cost included a salesperson incentive of AED (United Arab Emirates dirhams) 400 (in U.S. dollars, USD 109); if booked through the call center, the incentive decreased by half, to AED 200 (USD 55).5 Table 2-2 shows the effect of adding additional call center agents to the 100 already in place. The profit per agent was AED 37,000. In addition to sales incentives, there were approval costs for the various stages of application processing, such as data entry, verification, underwriting, wages/salaries, and calling costs. That figure was approximately AED 100 (USD 27) per transaction. If the booked product was a credit card, additional costs included card embossing, printing, and production, and the accompanying letter and card carrier, which totaled AED 50 (USD 14). The cost for courier delivery was another AED 50. Booking loans was less costly and had a higher probability of being collected. The UAE had a dim view of borrowers who failed to pay back loans—bouncing a check could result in a prison sentence. At Dunia, borrowers were required to provide postdated checks for each monthly installment at the time the loan was obtained.

Table 2-2 Call Center Capacity

Number of Call Agents Added

Number of Calls per Day

Employee Cost



100 each

AED 6,000 per agent

35 sq. ft./agent


100 each

AED 3,000 per agent

120/sq. ft./year

Source: Dunia. Used with permission.

For a product to succeed, the deciding factor was profitability. The focus on profitability was one of the leading-edge practices adopted by the Dunia SAU team, ensuring that a holistic assessment was done on the relationship’s overall value, rather than on one-dimensional metrics. The profit and loss statement incorporated all relevant revenue and expense items associated with the product. Dunia measured ROA on an annualized basis.

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