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The Sunday Independent more job losses in the banking sector are on the cards after Standard Bank this week said it would not rule out further branch closures as more of its customers bank through digital platforms.
The bank’s chief executive for personal and business banking, Funeka Montjane, said Standard Bank had seen a double digit decline in transactions in the last five years while digital transactions showed a double digit upscale in usage.
“The number of transactions that happen in our branches now makes up less than 1 percent. In terms of how many branches will be closed going forward will be made on a case by case basis based on whether customers are using that branch or not,” Montjane said.
“It will be irresponsible to keep branches opened and ask customers to pay for them while they don’t use them. Our people (employees) understand that the nature of work in the banking industry is changing because the servicing jobs are going away.”
In March, Standard Bank said more than 1 000 jobs were on the line as the group closed 91 branches across the country.
The announcement preceded the restructuring of its IT division which saw more than 500 workers sacrificed.
Last week Statistics South Africa said 94 000 people lost their jobs in the finance industry in the first quarter of this year.
South Africa’s big banks have been forced to change their service delivery with the entrants of tech savvy banks. TymeBank, SA’s first fully digital-driven bank, went live last month, while Discovery is expected to unleash its banking offering this year. Bank Zero, run by former FNB chief executive Michael Jordaan, is expected to launch later this year.
Bardien Pienaar, general manager at Merchants, said the new entrants and fintechs were threatening the fee structures and business-as-usual approach of traditional banks.
“It is a battle for survival in the banking space as digitally savvy entrants challenge traditional banks. Traditional banks are closing down their walk-in branches at a rapid pace, in favour of the convenience and cost benefits of digital solutions. It makes business sense and helps them remain competitive,” Pienaar said.
“At the same time, digital banks are looking to increase innovation and improve customer experience but should not do that at the expense of less than great human interaction.”
The Patrice Motsepe-backed TymeBank went live in February with a target to capture the majority of the 21 million potential customers in the middle-income band.
Cheslyn Jacobs, head of sales and service at TymeBank, said the financial services industry has to evolve with customer needs.
“We are excited to be part of this evolution with our branchless digital banking model, but are cognisant that the digital experience must be augmented with human interaction through our contact centre – especially in our industry where building trust is so paramount,” Jacobs said.
The original of this report by Kabelo Khumalo appeared on page 18 of The Sunday Independent of 26 May 2019
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