Goodbye to bank branches and the arrival of a new era

AND increasingly resonant restlessness heard in the financial sector: Is the end of physical bank branches? Digital banking has revolutionized the way we manage our finances, freeing us from need of entering a bank office and, therefore, financial institutions are rethinking their traditional physical presence.

The rise of this phenomenon is no mystery; It has been increasing in recent years, thanks to the penetration of technology in the banking sector and the preference of users for internet banking services. Despite this, its acceleration has reached unprecedented numbers during the Covid-19 pandemicwith limited mobility and face-to-face care.

But even after the return to some kind of normality and the declaration World Health Organization about termination emergency health, demand internet banking service has only increased, thanks to the constant flow of Millennials and Zoomers of hyper-connected people entering the world of work. All this seriously calls into question the need for physical branches of banks.

Globally, several major financial institutions have decided to close thousands of branches in major markets, focusing instead on strengthening their digital services. For example, in NOW, where 9% of all bank branches were closed between 2017 and 2021, according to data Coalition for Reinvestment of the National Community. In Spain, statistics on Bank of Spain show that in the last five years, 33.4% of branches were closed, that is, one in three. In Latin America, the trend is similar. According to data from National Banking and Securities Commission (CNBV)Mexico saw a nine percent decrease in the number of bank branches, from 12,849 in 2019 to 11,698 in December 2021.

These figures paint a picture that is clear: banking is digitizing at an accelerated pace, and the sector’s actions seem to match that fact. According to the latest research on Digital Banking Report, 77% of bankers worldwide predict that by 2025, three quarters of new accounts will be opened through digital channels. This percentage matches the research he conducted The Economist Intelligence Unit (EIU) which found that two-thirds (65%) of banking executives believe the branch-based model will be obsolete within five years.

Therefore, the ability to adapt to the digital revolution is essential for the development of banks and maintaining their competitiveness. Digital transformation has stopped being a trend to become an imperative need. For banks, it is no longer a question of whether to go digitalbut how to do it effectively.

Currently, the solution is found in digital transaction processing platforms. These innovative SaaS (Software as a Service) platforms manage the entire transaction lifecycle from the cloud, providing countless benefits and functionalities that are perfectly aligned with emerging payment ecosystems. It enables banks to provide sophisticated and modern solutions for your customers, eliminating the need for physical presence. Despite this accelerated digitization, it is important to remember that the user is still the priority, and the data processing platform digital transactions enables a seamless experience for banks an exceptional user interface, accessible from any device or channel.

It presents itself as an opportunity to reinvent banking, looks to the future and pioneers a modern banking experience that offers security, profitability and growth capacity.

It seems that the decline of physical branches is coming, but thanks to digital banking solutions, banks have the ability to adapt, overcome challenges, remain competitive and adapt the offer to the real needs of the client. Relay of digital adaptation he was already up, and for financial institutions now or never. Is your bank ready for this new digital age?

The author of this article is the Chief Revenue Officer at 2innovate.