The Customer’s Branch Office-ATM Starts to Be Abandoned

Jakarta, CNBC Indonesia – In the midst of the trend of digital bank services, there is interesting news, namely the tendency of bank customers to start reducing the use of ATMs (automated teller machines) in line with the changing character of current customers.

It was revealed Director of Treasury & International Banking of PT Bank Mandiri (Persero) Tbk (BMRI) Panji Irawan. He said that currently customers no longer rely on ATMs to make transactions, at least that happens at Bank Mandiri.

“Trends show behaviour no longer using ATMs, customers are comfortable using the application online,” he told CNBC Indonesia in the Economic Update, in Jakarta, Thursday (22/7/2021).

Bank Mandiri through the Livin’ by Mandiri application proves this trend. According to company data, ATM transactions at Bank Mandiri were lower. In the first quarter of 2021, transactions at ATMs amounted to Rp 200 trillion, smaller than transactions in applications which reached Rp 341 trillion.

“That’s why I say Mandiri Livin was developed. And interestingly, if you look at Mandiri Livin users since launching in March, the number of downloader user active has reached 7.1 million,” he added.

He said that Bank Mandiri targets that the number of users of the application will continue to increase. In fact, the number could reach 10 million. This means that this is in accordance with the current digitalization trend.

“Total transactions in the first quarter grew 39% worth Rp 341 trillion. The trend is changing, looking at the e-commerce It is estimated that it will double 1.5 times by 2025,” he said.

According to him, this is one of the trends that has accelerated due to the pandemic. People who stay at home have a changing pattern. For this reason, Bank Mandiri does not only invest in applications.

“But we are also in the middle office, back office, IT and updated infrastructure to support digitization,” he said.

However, in an effort to continue to improve customer convenience, Bank Mandiri has withdrawn as many as 5,000 old ATMs, so that currently, the ATMs available and owned by Bank Mandiri have good performance due to their young age.

“So that complaining goes down,” he concluded

Previously, the Financial Services Authority (OJK) also said that currently banks are also starting to be reluctant to open new branch offices. In fact, the number of banking branches has also decreased by more than 3,000 branches in the last 6 years.

OJK Deputy Director and International Banking Tony said the rise of digital banking transactions encouraged banks to choose not to open new branch offices because they were considered inefficient.

“In recent years, there have been very many transactions carried out at various banks through their mobile apps,” Tony said in a webinar titled Collaboration of Digital Banks and Fintech in Supporting the National Economy, Thursday (10/6/2021).

“Due to the rise of transactions through their mobile phones, it has an impact that people are increasingly visiting bank branch offices so that banks see the establishment of branch offices as inefficient and they have begun to cover a number of offices and start switching to electronic services,” he said.

From the material presented by OJK, the number of banking branch offices as of March 2021 totaled 29,889. This number is down from the position in December 2020 which was 30,733 branch offices.

This decline is also in line with the decrease in the number of commercial banks from 109 banks at the end of last year to 107 banks at the end of the first quarter of 2021. Meanwhile, at the end of 2015, there were 32,963 branch offices operating from 118 commercial banks operating in Indonesia.

The decline in the number of branch offices cannot be separated from the rampant digital transformation carried out by banks in Indonesia. There are even banks that claim that they are now fully digital banks.

“Some even say that it has become a fully digital bank,” he said.

[Gambas:Video CNBC]

(bag bag)

– .