Online banking drives NAB overhaul
The bank will gradually replace tellers with "smart" ATMs and phase out old features such as security screens. New branches will have an open-plan layout and encourage customers to talk to NAB about more complex financial products.
"A lot of over-the-counter transactions are high in volume and they actually take high costs to serve as well," NAB's executive general manager retail, Vicki Carter told BusinessDay. "In the future, many of those transaction will be done at different places [smart ATMs and the internet]."
Ms Carter said the overhaul of branches was driven by rapid technological change as more customers turned to the internet to do their transactional banking. "We now have around 1.3 million internet banking log-ins per day, up 30 per cent in the past four months."
The high penetration of smartphones in Australia is underpinning a rapid growth in mobile banking. NAB estimates 42 per cent of all internet banking log-ins are now done through mobile devices and that is increasing by 1-2 per cent each month.
Ms Carter said the new NAB business model would respond to this trend and allow customers to conduct simple transactions on machines but would " still give them access to people when they want to have deeper conversations".
NAB's new retail strategy is part of a wider industry trend as banks find new ways to cut costs and compete for higher margin business in wealth management and home loans. Westpac unveiled a similar plan in December.
Ms Carter said NAB had turned its smaller branch network presence into a competitive advantage in the new age of internet banking.
"In the past many of our competitors would have had more significant physical presence than us. What we are looking to do is to extend our presence through other means," Ms Cater said. "Having a smaller footprint is actually an advantage for us at this point." NAB has allocated a budget of between $50-$100 million every year to overhaul its branches and 30 of 780 branches across the country have been refitted so far. "Smart" ATMs will be installed at 10 NAB branches this year.
When asked whether NAB had seen a decline in people depositing money at banks as the result of the recent surge in the sharemarket she said: "We can expect that because it is typically the way the financial market works. We are starting to see some people coming back to the sharemarket and we are definitely seeing a lot of money going into self-managed super." However, Ms Carter said she hadn't seen any erosion of deposits yet and many Australians were still quite conservative with money management.
She also remained optimistic about a recovery in the housing market - a key driver of banks' revenue.
"It depends on what happens, of course, with the cash rate," Ms Carter said.
"Every economist at major banks talks about a couple more reductions. I think that will bring some people back into the market, because money becomes quite accessible at those low rates."
Frequently Asked Questions about this Article…
NAB is revamping its branch network to reflect that more customers are doing transactional banking online. The overhaul includes replacing tellers with “smart” ATMs, phasing out old security screens, and creating open-plan branches designed to encourage conversations about higher-margin products like wealth management. The goal is to cut operating costs and shift simple transactions to machines and the internet while reserving branch staff for more complex advice.
NAB reported around 1.3 million internet banking log-ins per day, which is up 30% in the past four months. For customers this means more services are being delivered digitally, with branches shifting focus to higher-value advice rather than routine transactions.
Smart ATMs are intended to handle simple, high-volume over-the-counter transactions while mobile and internet banking take an increasing share of log-ins. NAB says 42% of internet banking log-ins are now through mobile devices, rising by about 1–2% each month, and plans to install smart ATMs in 10 branches this year.
NAB has allocated a budget of between $50–$100 million every year for branch overhauls. So far 30 of its 780 branches across the country have been refitted under the new design.
No. NAB says the new model is designed to let customers do simple transactions on machines or online while still providing access to people when customers want to have deeper conversations about complex financial products.
Yes. NAB's retail strategy follows a wider industry trend of cutting branch costs and competing for higher-margin business like wealth management and home loans. The article notes Westpac unveiled a similar plan in December.
According to NAB's executive general manager retail, Vicki Carter, the bank has not yet seen any erosion of deposits. She said some people are returning to the sharemarket and there’s a lot of money going into self-managed super, but many Australians remain conservative with money management.
NAB is reasonably optimistic about a recovery in the housing market, but says it depends on what happens with the cash rate. Ms Carter noted that major bank economists expect a couple more rate reductions, which could make money more accessible and bring people back into the housing market.
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