Enacy Mapakame
The oldest financial services group in Zimbabwe, Standard Chartered Bank, is leasing out some of its properties across the country following closure of physical branches in a move being replicated across the African and Middle-east region.
The bank is placing focus on digital banking, in line with global standards and trends, where the market is increasingly becoming biased towards digitalisation as opposed to providing services through a physical bank.
The programme is being implemented across the region and has seen Zimbabwe left with only three physical branches across the country, one in Bulawayo and the other two in Harare.
Resultantly, the bank has sought alternative uses for its vacant properties.
Chief executive Ralph Watungwa, recently said at least 60 percent of the available properties had already been taken up by tenants from various sectors of the economy, including those in the financial services.
“So far, 60 percent of the properties have been taken up for alternative uses and these are both commercial and residential,” said Watungwa in an interview.
“We are at negotiating stages for the other properties we have that we are putting on the market for renting,” he said.
Watungwa indicated the programme was also one of the initiatives by the bank to cut operational costs and provide more affordable services to its customers.
The branch rationalisation programme has helped reduce costs by a third and other operational risks and losses from between $150 000 and $700 000 a year to only $12 000 as of 2019.
The banking sector has been affected by erratic power supplies that have been affecting the economy, which resulted in increased overheads.
Operating a physical branch on a generator required about 500 litres of diesel each day, which proved to be unsustainable in an economy also facing fuel shortages, on top of limited foreign currency and inflationary pressures.
Said Watungwa: “Our clients are better off with digital banking than visiting a physical branch, this saves time too.
“What’s left in the physical bank are conversations, we now have more meeting rooms to create a platform for customers who want financial advisory services. We discuss with our customers how they can create wealth.
“Instead of paying rent and other costs for operating a physical branch, we give all this to customers via their mobile phones.
“This is the route we are taking everywhere. Now, 70 products and services that customers used to come to the bank for are now available on their finger-tips,” said Watungwa.
With cash shortages that started in 2016 not significantly improving, Zimbabwe has increasingly adopted electronic banking to become one of the few African countries that have truly embraced plastic money, subsequently reducing the need for physically visiting the bank.
Electronic payments now account for 90 to 98 percent of all payments made placing Zimbabwe in the same league with developed countries such as Sweden that is currently at 99 percent.