South Africa?s retail banking sector is continuing the trend of downsizing and scaling back their physical presence in the country as clients turn to digital options.

An assessment of all banking branches at full-year 2024 shows that the country has seen the net closure of nine branches among the top five ?legacy? banks, with Standard Bank narrowing its footprint the most.

Even in cases where branch closures are not as prominent, the banks have also moved to shrink their points of presence, reducing the square meterage of operations where possible.

BusinessTech examined the full-year financial reports for Standard Bank, Absa, Nedbank, and Capitec for the latest available year. Data from FirstRand?s interim results were used.

The data reflects branch numbers as of the end of December 2024 for all banks except Capitec, where the numbers reflect data as of February 2025.

According to the assessment, the number of branches across the banks dropped from 3,299 branches in December 2023 to 3,290 branches in December 2024.

While the loss of 9 branches overall may seem negligible, only two banks actually added branches ? FirstRand added 9 and Capitec added 14.

These additions were countered by reductions at Nedbank, Absa and Standard Bank ? the latter most cutting its network by 26 points of presence.

According to Standard Bank, the group has made a concerted effort to cut down its branch numbers as part of an ongoing effort to migrate clients to digital platforms.

The group said that it has been deliberate in managing its physical presence, reducing its total branch footprint by 42% since 2017.

While this has reduced the group?s physical branch network for customer interaction, it has delivered cost savings of R768 million.

In addition, it has opted to increase its points of presence (PoPs) through lower-cost kiosks.

However, the devil is in the details with the group?s reporting. While it recorded 652 ?branches? in 2023, these are actually ?points of representation? comprising 485 physical branches and 167 kiosks.

At FY 2024, the group actually added one branch (to 486), but cut 27 kiosks, resulting in a net loss of 26 PoPs.

?We continue to optimise our infrastructure by reducing branch square meterage and ATM numbers, while increasing our points of access,? the group said.

?We know that many of our clients still need to access and process cash, and we understand that there is no substitute for in-person meetings when dealing with complex issues.?

Branches are also shrinking

Following the broader trend in the country, Nedbank has also been reducing its physical presence, dropping its branch total by 4 in 2024.

However, the group has also been reducing its branch floor space, cutting it to 118,000 square metres in 2024, having cut a cumulative 72,000 square metres from 2020 levels.

As with Standard Bank, the group has noted a direct relation between branch space and number and the advent of digital channels.

?Going forward, we expect these trends to continue as manual in-branch and ATM transactions decline as more clients make use of digital channels,? it said.

Running counter to the trend, Capitec has been expanding its branch network in line with its strategy to service its customer base in strategic locations.

The group noted that, on top of being able to deliver personalised customer service to clients, the large branch network also allows it to capture new business.

?Transacting is performed at the branch self-service terminals, whilst consultants enable us to successfully sell new products into the market and grow client adoption,? it said.

This is key as the group expands its services into new sectors like the insurance business, which may be underrepresented among its typical clientele.

?We see growth potential in the informal economy (emerging market) in South Africa. There is a need for credit, insurance, VAS, payment channels, education and support that has not previously been addressed,? it said.

?We will work towards meeting this need. We have a large branch network in the right strategic locations, and we will leverage this.? (Business Talk)

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