The vast majority of First National Bank's (FNB's) customer interactions are via digital platforms, with only 1.2% still happening face-to-face in branches.
This is according to Christoph Nieuwoudt, FNB consumer segment CEO, who says in 2016, FNB customers had over 10 billion interactions with the bank, of which only 120 million were face-to-face.
The bank says roughly 8.5 billion (85%) of interactions were purely through digital channels and the rest via point-of-sale (card swipes or online purchases) and ATM transactions.
"The number of FNB customer interactions has tripled since 2010, growing at more than 20% per annum every year, based on the growth in digital channels. Meanwhile, at branches, customers are making significant use of in-branch digital zones," adds Nieuwoudt.
"One thing we can all agree on is that digital progress is inevitable."
He says the implications of the use of technology by society are immensely profound, with terms such as "The Second Machine Age" or the "Fourth Industrial Revolution" being used to give this evolution a name.
"The reasons for the growth and migration of volumes to digital are obvious as almost every customer knows they can do basically any payment transaction, account or card service function and get most products...via the FNB app, online or cellphone banking," he says.
However, Nieuwoudt says this does not mean branches will go out of business. He notes branches and branch personnel are no less critical than before, but their role has changed from performing transactions to re-focusing on sales and advising customers on how to bank.
"In spite of the powerful digital technology, today the bulk of banking consumers still want to talk to someone when opening a new account and even for most product categories.
"Additionally, consumers often need help with the new technology, even just to get going and start using it.
"In most cases, branches can be much smaller, but with more room for digital zones and self-service devices such as ATMs and ADTs (deposit-taking machines). This journey is not unique to banking - virtually every sales or service business is or will be going through some elements of digital transformation."
Nieuwoudt also says that today only a very small percentage of credit decisions are made by people - rather statistical models are used to make fully automated decisions instantly at low cost and with accuracy not achievable by a person.
"This means your risk profile and behaviour determines your loan size and pricing. Importantly, technology has helped reduce fraud loss rates for card and digital transactions," concludes Nieuwoudt.
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