After merger of associate banks with itself in 2017-18, State Bank of India (SBI) is scaling down the pace of branch opening. It will open about 250 branches annually, as against the earlier 750-800 by the group.
Asked about the impact of the shift towards digital banking, using technology, SBI chairman Rajnish Kumar said physical contact points will still be needed because India is a vast country. Only, the outlets are becoming smaller. “You may have banking outlets with one or two persons but you will still require a physical location, where people can come and get the service,” he said.
Kumar mentioned they had rationalised about 1,600 branches in the network last year and this would be regularly reviewed. “We now have technological capability to merge 300-400 branches in a single day,” added the chairman.
After the merger of associate banks and Bharatiya Mahila Bank last April, SBI had indicated it wouldl take about 18 months to rationalise the branch network. Around 8,000 employees were redeployed. SBI expects savings from rationalisation of branch and administrative offices of at least Rs 11.6 billion annually. It paid Rs 4.73 billion to 3,569 eligible employees under their Voluntary Retirement Scheme in the past year, expected to result in salary savings of Rs 4 billion yearly.