Branch-based banking will be dead in five years, according to survey

banks close branches for digital channels

65% of global banking executives think the branch-based banking model will be dead within five years, according to a Report by Economist Intelligence Unit for Temenos.

The independent global report “Branching out: can banks move from city centres to digital ecosystems?” surveyed over 300 banking executives, half of whom are C-suite.

65% of the executives also believe cloud computing, artificial intelligence and APIs are the technologies that will have the biggest impact on the banking sector within 2025. Regulation and changing customers demand will also influence the market.

81% identify the ability to unlock value from AI as a key differentiator between winning and losing banks in the future: IT investment priorities also include cybersecurity and cloud computing.

The same percentage, 81%, also think working on the customer experience is essential to differentiate from competitors: many established banks are therefore looking at strategic partnerships and investments in technology as the way to remain trusted banking partners and develop consumer-friendly experiences.

The Covid-19 pandemic accelerated the journey to a collaborative and open model: 47% of bank executives expect their business to evolve into ecosystems in the next two years and to start offering third-party products and services to customers and other financial organizations.