Japanese Banks Also Reduce Branches... "1 in 4 People Never Visit Bank Counters in a Year"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Haeyoung] The proportion of financial consumers in Japan who do not use bank counters inside branches even once a year is gradually increasing. Accordingly, Japanese banks are rushing to significantly streamline their existing branches. This trend is similar to the branch efficiency trend of domestic banks.

According to the Korea Institute of Finance on the 8th, a survey conducted by the Japanese Bankers Association targeting 3,400 men and women aged 18 to 79 nationwide showed that the proportion of financial consumers who used bank counters inside branches at least once a year decreased from 92.7% in 2012 to 89.3% in 2015, and 75.8% in 2018.

On the other hand, the proportion of financial consumers using smartphone banking increased significantly from 6.5% in 2012 to 11% in 2015, and 20.8% in 2018.

In response to these changes in the business environment, Japanese banks are changing their branch operation methods and introducing branches with new functions.

Mitsubishi UFJ Financial Group (MUFG) plans to reduce 180 of its approximately 500 branches and reorganize existing branches by 2023. In particular, bank counters, which were mainly located on the first floor, will be moved to the second floor, and high-performance ATMs and video call devices will be installed on the first floor instead of office spaces. Mizuho Financial Group will convert all branches within the group into joint branches that perform banking, trust, and securities services. The number of branches is planned to be reduced by about 100 by 2024.

The Korea Institute of Finance stated, "Due to technological advances and changes in awareness regarding the use of financial services, the number of customers visiting bank branches and their usage time are gradually decreasing," and "along with concerns that the functions of existing branches are becoming disconnected from reality, labor shortages due to the decline in the working-age population, especially securing sales personnel, have emerged as important issues, leading to a push for significant efficiency improvements in the existing branch work processing methods."

This content was produced with the assistance of AI translation services.