Mobile banking take-up skyrocketed, but it's not enough to kill off bank branches just yet, according to Westpac Retail and Business Banking Group Executive Jason Yetton.
At Westpac, there is now the same amount of mobile banking transactions completed as those made in retail branches and over the phone — combined. Overall, the bank processes three times more transactions made digitally, compared to transactions made in person.
Westpac expects to process over one billion digital payment transactions in the next five years, with a total value of AUD$6.8 trillion. It also predicts that mobile customers will hit 5.2 million by 2017-2018.
Is branch banking still relevant in a world where people prefer to do most things by just tapping their mobile phones? Westpac thinks so.
"While many have predicted the death of branch banking over the past two decades, it's having a much more protracted death than expected," Yetton said at the FST Media banking technology conference in Sydney. "On average, we have seen teller transaction volumes decline about five percent per annum."
Westpac has continued to upgrade its 1300 branches nationwide as part of its BankSmart Strategic Investment program. The objective is to modernise the branches, focusing more on providing an interactive experience, rather than a transactional one. That means removing barriers between teller stands and customers, installing new technology, such as Westpac's new Spider teller system, and making branches look more inviting. This is due to Westpac recognising that customers still prefer to speak with a person when it comes to making big banking decisions that may be emotionally charged, Yetton said.
"Customers will continue to seek face-to-face advice and expertise from people they trust, particularly if it's a more complex product or if it's a big decision in their life," he said. "This requires a completely different approach for training, skilling, and hiring."
"Despite the adoption of technology, we believe banking is still a people business and that customer relationships are at the heart of a successful business."
Westpac also acknowledged video technology as a good way to provide face-to-face specialist advice to customers in regional and remote parts of the country who may not have convenient access to a bank branch.