One of Europe’s leading digital banks has announced that it will set aside about $18 million to spend on creating a new network of physical branches but is keen to emphasize that these branches will be “light” and compact with all modern features. Moving from digital only channels, Poland’s mBank will ensure that its branches are attractive to consumers and will include multi-touch screens, motion sensing and face-recognition technologies.
Building its branches in popular shopping centers, the bank hopes to optimize foot traffic and get a decent return on investment. In a statement regarding the new branches, mBank said,
“The investment will result in an optimal adaptation of the bank’s branches to the needs of a modern – and often mobile – client.”
Digital-only banks today are still in the very earliest stage of development and thus should not be underestimated. It is entirely possible that in the next few years digital-only banks (whether independent or future versions of today’s mainstream financial institutions) will become the norm as consumers increasingly rely on digital channels and other technologies that make traveling to a physical branch largely unnecessary. As a result, the current digital-only bank service providers can be viewed as avant-garde.
By embracing the omnichannel approach, digital banks do not necessarily have to embark on creating vast new physical branch and ATM footprints but can take the lessons learned from traditional financial institutions and innovative digital banks that are already employing a more specific omnichannel approach and create new and innovative branch environments, steeped in technology that draws consumers in and located in nontraditional banking environments. However, digital banks should not forget their natural advantages with electronic channels that already communicate with one another and have common databases.
Overview by Tristan Hugo-Webb, Associate Director, Global Payments Advisory Service at Mercator Advisory Group
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