Australia: Physical bank branches set to decline

Research conducted by Morgan Stanley suggests that physical bank branches are transitioning into solely sales and advice centres. The acceleration of mobile banking services is part of the reason for this shift, with mobile banking services providing banks with opportunities for multi-billion dollar cost savings and new sources of differentiation.

According to the investment bank’s analyst, Betsy Grasek “we see the adoption of smarter, smaller branch designs, reduction in branch count, and active guidance of customers to mobile self-service”.

RFi Group data demonstrates the shifting role of physical branches. The use of physical branches for account acquisition has declined from transaction account holders that used it for this purpose 5 or more years ago compared to those who opened the account more recently. Meanwhile, online channels are becoming more prevalent for acquisitions.

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