Despite increased adoption of digital banking, most of South Africa’s big banks are still maintaining a prominent physical footprint to serve their customers.
Since the start of the COVID-19 pandemic, more customers are opting to use Internet, mobile, or app-based channels as opposed to visiting bank branches.
The banks have noticed this trend and quickly adapted to offer their clients the services they need online. For example, Capitec rolled out a feature to its mobile app which allowed customers to sign up, get authenticated biometrically, and create a virtual card which they can immediately use to make payments.
The move to digital raises two big questions – do banks see less value in having physical contact points with customers, and are they closing branches as a result?
MyBroadband recently asked the major banks how many branches they closed and opened permanently over the last year, and what their strategy is going forward.
Most banks still maintain a large branch footprint, and only one had actually closed a significant number of branches over the last year.
The table below shows the number of new, closed, and total branches. It also show how many ATMs each bank has.
Where a bank did not provide details, information was sourced from their latest annual results.
|Number of branches and ATMs at major banks|
|Bank||New branches and/or kiosks||Closed branches and/or kiosks||Total branches and/or kiosks||Total ATMs|
|FNB||14 (3 years)||–||600||5,000|
Below is the strategy of each bank with regards to branch closures and rollouts in the near future.
Absa Retail and Business Bank Managing Executive for Physical Channels Tshiwela Mhlantla said the bank’s current strategy was not to close branches.
“We are investing in our branch network with the aim of continuous optimisation of the capabilities of our branches with formats that are fit for purpose and support the areas we trade in,” Mhlantla said.
“Generally, the decision to close a branch is the last resort, and even in such instances, we always leave the community with a capability to continue to transact, mainly through our automated teller machines (ATMs), as the provision of quality banking services to our customers remains at the centre of Absa’s ambition to deliver full-value banking.”
She said despite the rapidly evolving digital landscape, the “human touch” remained integral to resolving complex customer queries.
“Our branch colleagues play an important role to advise and assist in selecting banking products appropriate to individual customer needs and circumstances,” Mhlantla said.
FNB Points of Presence CEO Lee-Anne van Zyl said that the bank planned to add a further 50 community branches in the next three years.
“In line with our commitment to offer unassisted and assisted service across our environments, we have already revamped 130 branches in recent years, and an additional 53 branches are being renovated to integrate new world-class technologies and improve customer experience for our retail and commercial customers,” Van Zyl said.
Van Zyl said FNB’s aim was to ensure that the right services are available to customers near where they lived or worked.
“Our points of presence like branches and ATMs serve a meaningful purpose to our customers, communities, and brand,” Van Zyl said.
Nedbank closed the most branches of any bank over the last year – with 48 branches closed since the start of 2020. The bank said it continued to adjust its branch footprint to accommodate changing market and client behaviours.
“We constantly review all markets to ensure that we are correctly sized and accessible to clients,” the bank stated.
As a result, Nedbank has expanded in large metros or new infrastructure developments where they expect to see growth. This has resulted in seven new Nedbank points of presence in the last year – three new in-store Boxer outlets and four branches.
In addition, Nedbank is closely monitoring the reduction of demand for particular branches or shifts in the market.
Nedbank said its current plan includes reformatting its branches into a mix of branch types that cater for convenient self-service options, while still including Nedbank employees to assist clients to use these self-service channels or to provide them with value-added advice.
Standard Bank said it continued to review its footprint and invest in local markets thus increasing its access points and footprint. Its branch numbers have remained relatively static for the period, with a marginal increase in points of presence.
These include 513 branches, 16 kiosks, 12 Bank on Wheels, and 1 “other” point of presence.
Despite being the largest bank in South Africa, it had less ATMs than Absa and FNB.
However, it emphasised that it has removed the Saswitch fee so that its customers can use other banks’ ATMs without additional fees.
TymeBank does not operate any standalone branches, but rather has kiosks in Pick ‘n Pay and Boxer stores which offer banking services to its customers.
TymeBank executive for sales and service Cheslyn Jacobs said the majority of the bank’s kiosk closures happened at the height of the COVID-19 pandemic.
“To ensure we continued with our mission to make banking accessible to consumers, we transferred kiosks to locations where demand for our offering was high,” Jacobs said.
“Our focus is to continue to engage consumers and our customers through the existing distribution footprint, and to make our mobile kiosks accessible where there is greater demand for our products.”
Jacobs added that TymeBank customers were also able to open new bank accounts through its app-enabled biometric functionality, negating the need to visit a kiosk.
Capitec did not respond by the time of publication, while Discovery Bank does not offer any branches and was therefore not included in this comparison.