China’s bank branches, ATMs dwindle amid e-payments and cashless shift
- Banks cut costs by employing fewer branch workers and embracing digital, so when cash is needed it can be harder to come by
Once abundantly dispersed across China to serve the banking needs of more than a billion people, physical bank branches and ATMs have seen their numbers dwindling as the public embraces e-payment platforms and financial institutions cut costs.
And as most of the public can use their phones to conduct banking and monetary transactions, closures have gradually outpaced new installations.
In the first half of this year, 1,126 bank branches closed while just 968 new ones were approved, the Shanghai-based news media Cailian Press reported on Monday, citing figures from the National Financial Regulatory Administration.
That is compared with the January to June period last year, it said, when 1,600 bank branches shuttered while 850 were established.
The number of ATMs in China declined by 8,358 in the first quarter of the year to 837,100, according to data released by the People’s Bank of China last week.
The rise of e-payment platforms over the past 20 years, to where most transactions are cashless, explains much of the decline, according to analysts. That trend has allowed banks to cut costs on physical property and staffing, they said.
“The banks have found it unnecessary to add branches as they reduce costs,” said Chen Zhiwu, chair professor of finance at the University of Hong Kong. A refocus on mobile payments among other online transactions, he said, “has in effect served to reduce face-to-face services at banks”.
