WHY PHYSICAL BANK BRANCHES REMAIN CRUCIAL IN AN ERA DOMINATED BY DIGITAL

Trust, human engagement, and relationship management remain crucial for customers

- DHEERAJ SANGHI

Faced with the rapid growth of digital technologies and an expanding millennial and Gen Z customer base, banks in the US and Europe cut back on physical branches over the last decade. While this strategy did influence a global realignment, Indian banks bucked the trend, and instead focused on branch expansion, which led to one of the strongest growth periods for the Indian banking industry.

Now, the likes of JP Morgan Chase and Bank of America plan to open 500 and 165 new branches, respectively, over the next two to three years, underscoring the need for a physical network to meet the requirements of retail banking.

Personal touch: Research shows that while 70% of consumers are open to buying through digital channels, only 23% fulfill their financial needs digitally. For finance and wealth management, customers prefer real interactions with advisors before arriving at a final decision.