Our reporter Su Xianggao
Since the release of the "Notice on Matters Concerning the Establishment of Community Branches and Small and Micro Branches by Small and Medium-sized Commercial Banks" (hereinafter referred to as the "Notice") in December 2013, community branches have been established for ten years.
In the past 10 years, commercial banks have gone through a complete cycle of initial attempts to expand their community branch branches, racing to enclose new areas, closing down large numbers, and re-layout.
During this period, more than 8,000 community branches have been established one after another. After the "big waves washing away the sand", there are currently only more than 4,300 branches left.
The reporter learned that at present, the monthly retail AUM (total assets under management) of some community branches has far exceeded some ordinary bank branches with a business area several times that of their own.
Standing in the present moment, analyzing the successful experiences of some community branches and reflecting on the reasons for the failure of other community branches has positive practical significance for commercial banks that are still operating and plan to expand community branches, and also has long-term significance for promoting the development of inclusive finance in our country. significance.
Based on this, a reporter from Securities Daily recently visited Minsheng Bank, which was the first to propose the concept of “community finance” and currently has the largest number of community branches.
Community branches experience reshuffle
"Community bank" and "community branch" are often confused by people, but in fact the two concepts are completely different.
"'Community bank' is a type of bank, a legal entity, while 'community branch' is a simple branch of a bank. The two are completely different. In China, many practitioners and researchers mistakenly regard community branches as community banks ." Dong Ximiao, chief researcher of China Merchants Union, told a reporter from Securities Daily.
In 2013, Minsheng Bank proposed the concept of “community finance” for the first time and promoted the development of community branches.
Subsequently, in December 2013, the former China Banking Regulatory Commission issued a "Notice" requiring banks to establish community branches and small and micro branches to complete relevant administrative approval procedures and implement licensed operations.
Since then, community branches have been formally brought under supervision and have developed rapidly in the following years.
Compared with ordinary bank branches, community branches strive to be closer to retail customers, targeting residents and small, medium and micro enterprises around the community to fill the gaps in financial services that are ignored by traditional bank branches.
Therefore, it is also known as the "bank at your doorstep".
"Compared with standard branches, community branches have unique advantages. Community branches take advantage of 'geography' and 'popularity' to help form a more stable banker-customer relationship. On the one hand, community branches have small branches, few team members, and comprehensive Low cost, responsive to customer needs, and through digital empowerment, comprehensive business acceptance and professional processing have become an important practice in exploring light banking. On the other hand, community customer groups are rich in composition, especially the elderly and new citizens. , small and micro businesses and other inclusive customer groups." Talking about the positioning and advantages of community branches, the relevant person in charge of Minsheng Bank told a reporter from Securities Daily.
After the concept of community branches was proposed, many commercial banks have actively deployed it.
Public data shows that in the past 10 years, more than 8,000 community branches have been established. However, many commercial banks' attempts did not go well, and 3,800 community branches were closed during this period.
Talking about the reasons for the abolition of a large number of community branches, Dong Ximiao analyzed: "In the early stages of development, some banks did not carry out top-level design and reasonable planning, did not include community branches in the unified consideration of the bank's channel strategy, and did not integrate with ordinary physical branches and online channels. Form effective linkage. Some banks have been too aggressive in establishing community branches. The establishment has not been strictly verified, there are too many and excessive phenomena, and it is divorced from customer needs and business development reality. This is the main reason why many community branches have been abolished in recent years. reason."
After years of reshuffle, a large number of community branches have quietly disappeared.
However, some banks have found a more mature development model and opened more and more community branches.
China Minsheng Bank’s strategy
According to the reporter's understanding, as of the end of October 2023, the number of licensed community branches of Minsheng Bank reached 1,081, ranking first among all commercial banks. Among them, the monthly retail AUM of some community branches has far exceeded that of some ordinary outlets.
How did Minsheng Bank achieve big business in a small community branch?
With questions in mind, a reporter from Securities Daily recently visited a number of community sub-branches of the bank’s Xi’an Branch and Shijiazhuang Branch.
At around 4:30 p.m., general bank branches have already begun to prepare for closing, but Minsheng Bank Shijiazhuang Branch Yuanyan Community Branch is at the busiest time of the day: at the entrance of the branch, nearby neighbors are either queuing up to receive group shopping supplies, Discounted cooked food products, or waiting for a haircut, medical consultation...
"Our business model is that the branch carries out 'resource exchange' with merchants within 2 kilometers of the surrounding area to form a merchant alliance. On the one hand, we work with merchants to provide coupons to customers; on the other hand, customers use our bank cards at merchants Consumption can also be discounted. This method can not only increase the stickiness of the customer base, but also expand merchants into customers." The account manager of Yuan Yuan Community Branch told reporters.
At the entrance of the Yuan Yuan Community branch, Mrs. Guo, who is over 80 years old, walked slowly pushing a cart that served as a handrail. Account manager Xiao Li greeted her warmly and helped her take her blood pressure.
Xiao Li has been working here since the community branch opened in 2017. She can call out the names of dozens of old neighbors like Mrs. Guo.
According to the reporter's understanding, most of the community residents near the Yuanyan Community Branch are retired employees of enterprises and generally have relatively stable salary incomes.
Mrs. Guo was the head nurse of a hospital when she was young.
She told reporters that before deciding to transfer most of her savings and pensions to the Yuanyan Community Branch, she conducted a year-long "investigation" of the branch's account manager Xiao Li. After comparing with other banks, she felt that the branch The service is humane and the account manager is reliable and thoughtful.
In fact, Yuan Yuan Community Branch is just a microcosm of Minsheng Bank’s community branch business model. Similar branches are also distributed in Xi’an, Beijing, Shanghai, Guangzhou and other cities.
Qi Guohua, president of Xi'an Branch of Minsheng Bank, told reporters that since 2013, Xi'an Branch has implemented the strategic deployment of community finance of the head office and tried to set up community branches in areas where residents gather, such as places of residence, work, living and transportation, etc., and is committed to In order to solve the problem of insufficient coverage of the "last mile" of traditional financial service channels, a lot of exploration and attempts have been made in customer management, assessment and incentives, business promotion, marketing promotion, risk management, team building, etc.
With a combination of punches, the community branch of Minsheng Bank Xi'an Branch quickly spread.
According to the reporter's understanding, as of the end of September 2023, Minsheng Bank Xi'an Branch has approximately 61 community branches, covering the main urban areas of Xi'an, serving more than 200,000 families, more than 450,000 customers, and managing customer financial assets exceeding 25.3 billion yuan.
From the perspective of customer experience, at the Dongshang Community Branch of Minsheng Bank Xi’an Branch, customer Aunt Zhang told a reporter from Securities Daily: “I was originally a customer of another bank. I applied for a Minsheng Bank card after being introduced by relatives and friends, and I have experienced it for a while. Later, every time the pension arrives, it will be transferred to Minsheng Bank. There are two reasons for this: first, I am familiar with the bank manager, the bank has a convenient corporate WeChat group, and the branch atmosphere is friendly to the people; The bank managers are very attentive and even provide on-site help sometimes when I have a headache or a fever.”
Optimizing organizational structure, improving service quality...the core goal behind many measures is to better reach customers.
It is precisely because Minsheng Bank anchored the development of community branches and worked hard to open up the "last mile" of financial services that it triggered a butterfly change in operating results.
How to evolve under the new situation
In addition to experience, the future development of community branches has also attracted industry attention.
The relevant person in charge of Minsheng Bank told reporters that on the occasion of the tenth anniversary of community finance, the bank will upgrade community branches from three dimensions.
The first is to strengthen the public welfare nature of community services.
In the future, a normalized activity system will be established, and various operating agencies will be encouraged to combine local people's livelihood characteristics, residents' needs, and critical time points to gather forces from industries, streets, property committees, neighborhood committees, etc., to form community convenience service activities.
The second is to strengthen the inclusiveness of community services.
Focusing on the government and regulatory requirements for long-term and phased work of financial institutions, we focus on key issues in the high-quality development of society and people's livelihood, and provide convenient services to inclusive customer groups.
At the same time, using merchants and community branches as connection points, combined with scenarios and activities, it radiates to surrounding governments, enterprises, residents, etc., forming an omni-channel service delivery.
The third step is to strengthen the professionalism of community services.
Enhance expert support and provide valuable information and service solutions.
From an industry perspective, many industry insiders believe that due to differences in strategic positioning, resource endowments, etc., some commercial banks that are still promoting community branches and plan to promote community branches in the future still need to learn from and refer to the successful experiences of their peers. Combined with the long-term development trend of bank branches in the future, we can achieve better development of community branches.
Dong Ximiao said that the saying "the terminal wins, the channel is king" is still not outdated. In form, banks have evolved from "brick banks" to "mouse banks" and then to "fingertip banks".
Therefore, on the one hand, community branches must give full play to the unique functions of physical outlets, transform from transaction-oriented to service-oriented, strengthen online and offline collaboration, and provide customers with more choices; on the other hand, they must accelerate the development of lightweight, intelligent, and scenario-based The pace of transformation reduces costs while improving efficiency.
Zeng Gang, director of the Shanghai Finance and Development Laboratory, told a reporter from Securities Daily that the current bank out-of-counter rate (the ratio between the total business volume handled through non-counter channels and the total business volume handled through all channels) is close to 90%. During the operation of branches, on the one hand, it is necessary to strengthen online and offline interactive services, on the other hand, it is necessary to improve the convenience of services for the elderly and other groups, and to enhance the service capabilities of some businesses that regulatory requirements must be handled offline.
"Customers are the cornerstone of all development. The current transformation of commercial banks to digitalization and online is a major trend, but this does not mean that the functions of traditional branches will disappear. The key is to follow the trend and promote online and offline integration and linkage." Qi Guohua also told reporters.
The Central Financial Work Conference held at the end of October 2023 clearly stated that "Five big articles should be done well in technology finance, green finance, inclusive finance, pension finance, and digital finance." Community branches are important in promoting the development of the "Five Big Articles" One of the carriers, how it will evolve and develop in the next decade is still worthy of our further thinking.
(Securities Daily)