JAKARTA. Some private banks will be more focusing on digital banking, rather than expanding the number of branch offices. Not surprisingly, some banks have started reducing the number of branch offices to achieve the target of developing digital banking business.
For an example, Bank CIMB Niaga will be more focusing on the utilization of information technology (IT), on the grounds that the system will be more efficient in terms of budgeting. “This year, we will reduce dozens of branch offices,” said Financial Director of Bank CIMB Niaga Wan Razly Abdullah.
Without revealing the number, Wan Razly said that CIMB will expand the digital banking in this year. The bank even will allocate about 50% of the total 2017 capital expenditure to strengthen the digital banking. The budget will be allocated to upgrade the information technology (IT), as well as to enhance the mobile and internet banking features.
KONTAN has recorded that some banks under the category of Commercial Banks Group of Business Activities III (BUKU III) have cut the number of branch offices. During the same period, Bank CIMB Niaga has shut down 129 of its branch offices.
Likewise, Bank Maybank Indonesia and Bank Danamon Indonesia also have shutdown 36 and 33 of their branch offices, respectively, during January-September 2016.
Chief of Board of Commissioners of OJK (Financial Services Authority or FSA) Muliaman Hadad estimates that the branch offices shutdown is part of the strategy of the banks to take advantage of digital technology development. “Financial industry has to anticipate the digital trend, mainly related to the consumers’ choice in interacting with the banks,” Muliaman said, Friday (10/2).
Head of Economic Risks and Financial System Group at Deposit Insurance Agency (LPS) Dody Arifianto said that the banks have to prepare some networks in optimizing digital banking transactions. “Naturally, the banks will shift from the conventional banks to the digital banking,” Dody said.
Furthermore, the number of transactions via ATM would also be reduced. This reflects on the growing number of transactions via mobile and internet banking.
Some other bankers also decided to not open new branches in this year. Retail Director of Bank Permata Bianto Surodjo said that the bank will maintain the number of the branch offices in this year.
Bianto continued, the bank will enhance mobile banking and internet banking in the distributions of service and product, as recently the consumers tend to prefer to use digital technology.
President Director of Bank OCBC NISP Parwati Surjaudaja said that, OCBC NISP will not expand the number of branch offices. “We will optimize the existing networks,” Parwati said.
(Muhammad Farid/Translator)
