State Bank of India has decided to scale down the pace of opening new brick and mortar branches in the country. It will open more digital branches. In the current fiscal, it will open only 500 branches against the original target of 1,000. In comparison, the pace of opening digital branches will gather speed.

At the inauguration of the bank’s InTouch (digital) branch, Chairman Arundhati Bhattacharya told media persons on Friday that 250 such branches have been planned till March 31.

Branch strategy

The SBI management is trying to change the branches based on customer profile. The strategy for operating branches will be geared towards finding the right kind of branch for the right kind of customer profile, she said.

Today, SBI has 12 hi-tech branches in the country, which have ATMs, cash and cheque accepting and passbook updating machines. In such branches most of the banking transactions are automated.

Bhattacharya, however, underscored that as a large section of the population is above 50 years of age, physically manned bank branches will still be required. Physical branches will continue to have relevance for another 10-15 years. However, new branches will be opened purely on viability. There will also be an evolution of branches, from regular banking they will move to customer advisory services for loans and savings instruments.

She said that today in branches with high amount of cash transactions, the bank managers have no time to talk to the customers. But as more and more transactions move to machines, managers will begin to offer more advisory services.

On the follow-on offer (equity) of the bank, the SBI chief said it will not happen this fiscal.

She also said that further cut in lending rates is unlikely this fiscal year.

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