The Credit Union Unicred (from Paraná and Santa Catarina) plans to launch until the end of this year a branch that will also work as a coffee shop. In up to two years, the Credit Union expects to have also a mobile branch, which will be present at the beaches of the two states during the summer. It should also be present in cities where health sector events are held.
The projects may be expanded to other locations in the country in the future. The Credit Union has 236 branches and 183 thousand customers in Brazil. In Paraná and Santa Catarina there are 63 branches, and 67 thousand customers.
A survey by Febraban released last week shows that mobile banking (through mobile phones) became the main channel for Brazilians in 2016 and was responsible for 34% of operations (they were 20% in the previous year), followed by internet banking (through the computer), at 23%.
“The orthodox model with large infrastructure and several cashiers has changed. The branches are smaller, but integrated to the customer’s routine. They hardly come to a branch only to sort out financial issues", says Luis Schuler, Director of Operations at Unicred's Central. The new concept of branch-coffee shop was inspired in the American bank Capital One, according to him.
At Capital One’s branches with coffee shop, the customer may savor a good coffee while learning means to manage their finance, in addition to solving questions about investments with the managers.
“The number of branches will be reduced in the future, and the ones that remain must adequate themselves to the new customer”, says Roger Pires Müller, co-founder of ilegra, consultancy and system integrator from Porto Alegre, which is designing Unicred’s future agency.
Banks study ways to maximize the branch’s use
Large branch areas with broad parking lots are giving space for real estate projects, in which the branch itself will be redefined in a smaller space.
“Nowadays there is a high cost involved in maintaining a underutilized branch in a prime area of the city”, says Álvaro Taiar, a partner in the US consultancy PricewaterhouseCoopers, which studies the remodeling of banking branches in Brazil.
Large branches can also create spaces to offer computers with internet access to the population and areas to offer talks on financial products and economics.
“Is there space left in the branch? Let’s turn it into a coffee shop, a room for financial services training, a lan house. This is being studied by the banks to maximize the use of the agency”, says Taiar.
Japan House and Starbucks in Bradesco’s branch spaces
Bradesco is an example of use of infrastructure to various purposes. In a branch on Avenida Paulista, in São Paulo, the Cultural Center Japan House was created, opened in the end of April, in an agreement with the government of Japan. The space of another branch on Paulist was leased by Starbucks, to open a franchise of the American coffee shop.
Nevertheless, the number of brank branches has been increasing: 5,112 branches today, as compared to 3,162 in 2007. "Many of them are being adapted to the new business model, more compact, with smaller spaces, and with specialized teams more focused on businesses", says Aurélio Guido Pagani, Bradesco’s Executive Director. For him, the physical structure is still important in Brazil, since not everyone has access to the new technologies.
José Roberto Machado Filho, Executive Director at Santander, says that the bank is already adjusting to the new reality, planning to create the concept of branches as a new market place, sharing the space with partners to act along with customers. The institution has not disclosed who those partners would be.
Santander also presents increase in the number of branches. In 2015, the bank had 2,263 branches and 1,176 Bank Service Points (PABs). In 2004, there were 1,888 branches and PABs. “In a country with dimensions such as ours, the physical presence is and will continue to be importan”.
Less branches, more technology.
Ricardo Munhoz, Market Director at Atos no Brasil, a French systems integrator, says that there will be a drop in the number of branches in the country and the ones that are remodeled will have a high technological standard.
“The branch of the future is the one that will complement the digital bank. It will not be made for paying bills, but to guide the customer in complex products, such as investments”.
Atos was part of the remodeling of the ING Bank branches in Belgium, in 2016. The bank does a facial recognition of the customer, as soon as he enters the branch. The information is sent to the manager in his smart watch, which can pull up the questions the customer had in his search in the digital media in interactive tables.
“This movement is very fast in Europe, where the banks are drastically reducing their branches. This is a concept we are starting to present to Brazilian banks”.
In the United Kingdom, for the past two years, over one thousand branches were closed as a result of the use of mobile phones in financial operations. HSBC headed the movement: 321 branches closed in the period; another 62 should close in 2017.
“The branches, however, will not be extinguished”, asserts Eduardo Diniz, professor of the Business Administration School at FGV-SP. According to him, 11% of all loans need to have assets in equity, which includes the branch network. "The design of the branches will be different, though, with smaller areas, internal use of technology and fewer employees”