“ADue to new uses and new customer expectations, the health crisis and periods of confinement and their impact on branch traffic, strong pressure on costs and the context of digitalization, Moroccan banks have begun a process of reducing the number of agencies scattered throughout the territory»Mohamed Azzal, manager at Ailancy, a specialist in retail banking and financial services, explains straight away.
Indeed, after a slight increase of 0.6% in 2019 and the opening of 36 new branches across the Kingdom, the banking network was reduced by 29 branches in 2020 to stand at 6,510, i.e. 1 counter for 5,500 inhabitants. against 5,400 a year earlier. “Today, the main challenge for Moroccan banks is to find the best possible balance between a local network, increased availability for customers and strategic cost optimization”explains Mohamed Azzal.
In this development, conventional banks closed 50 of their branches in 2020. On a global scale, the banking sector is engaged in large-scale transformations under the influence of structuring factors: customer expectations, regulations, technologies, etc. The bank’s distribution model is changing, with declining branch traffic and increasing use of remote access to banking services.
To differentiate themselves and take advantage of the relationship of trust that binds them to their customers, banks are trying to provide more advice and added value to the customer. This requires necessary organizational shifts and a transformation of the commercial posture. In Morocco, banks are also part of this dynamic and have to date taken action around 3 major themes, explains our expert:
• “The transformation of agency formats and the appearance of the “phygital” model: a digital transformation process has been put in place, in particular through equipping agencies with digital tools; • Improving the customer journey: new customer journeys have been designed and new relational models have been put in place; • The development of branch jobs: through the specialization of certain branches and the orientation of branch functions towards consulting, a function with greater added value for the client and the bank”.
The bank branch still has a bright future ahead of it
“The acceleration of digital has certainly turned the business model of banks upside down in recent years, but will certainly not remove the need for human relations in a country where the prevalence and circulation of cash are constantly increasing”by Mohammad Azzal. In addition to the cash that will continue to circulate and therefore encourage people to come to the branch, for certain issues, there is always a need to be able to speak with an advisor, in a space dedicated to this purpose. Moreover, we are in a country where a significant percentage of the population does not have the knowledge and the essential technological tools to carry out all online banking operations.
Finding the right balance between physical channel and remote channel
“In sum, the physical branch networks of Moroccan retail banks will have to demonstrate resilience and agility in the face of adversity. They will have to continue to reinvent themselves to strengthen proximity and relational intensity with customers, meet expectations according to a model combining face-to-face and distance learning, and continue to provide support solutions with very high added value.explains Mohamed Azzal. It is also essential to maintain the complementarity between physical points of sale and digital offers and find synergies between these two networks in order to best manage current and future developments.