China Citic Bank International, a mid-tier lender based in Hong Kong, is embarking on an initiative to significantly reduce paper usage in its 24 branches, with the goal of saving approximately 1 million pieces of paper annually.
This endeavor aligns with the broader trend in the banking industry, where major institutions like HSBC, Standard Chartered, and Bank of China (Hong Kong) are actively encouraging their clients to utilize mobile apps for banking transactions, thereby minimizing the reliance on paper forms within their branches.
China Citic Bank International, a subsidiary of China Citic Bank, has been proactive in adopting digital solutions in recent years. The bank has allowed customers to open accounts online since 2018 and has expanded its digital offerings to include online insurance sales and wealth management services. The impact of the COVID-19 pandemic accelerated the shift towards digital banking, with customers increasingly using mobile phones to conduct simple banking transactions.
Wendy Yuen Miu-ling, Deputy Head of the Personal and Business Banking Group at China Citic Bank International, stated in a recent media briefing that mobile banking would be their priority for expansion in the coming years. Even in physical branches, the bank aims to have staff utilize electronic methods to serve customers rather than relying on paper forms. The ultimate goal is to transform all 24 branches into paperless environments starting next year.
Yuen emphasized that this shift towards digital banking would not only benefit customers but also lead to cost savings for the bank. "The use of fintech will cut down operating costs for the bank and will enhance the service for customers," she noted.
As part of its digital banking strategy, the bank plans to close some smaller branches. However, it will continue to evaluate the need for physical branches, particularly for customers who require assistance with complex transactions like mortgage loan applications.
Industry experts believe that the move towards digital banking is becoming increasingly essential for banks to remain competitive, especially among younger, tech-savvy customers. Major banks like HSBC, Standard Chartered, and Bank of China (Hong Kong) have heavily invested in digital banking services, making it imperative for smaller lenders to offer robust mobile banking options to stay relevant.
Terence Tse, a Professor of Finance at the University of Hong Kong, explained that people's preferences have shifted away from visiting physical branches for routine transactions, making digital banking services a focal point of competition. This shift creates opportunities for smaller banks with fewer or no physical branches to compete effectively by offering strong mobile banking services.
The Hong Kong Monetary Authority has been actively encouraging banks in the city to expand their fintech offerings since 2017. Additionally, the authority has issued licenses to eight 'virtual banks,' which operate without physical branches. Established banks like Standard Chartered and Bank of China (Hong Kong) have also ventured into the virtual banking sector.
HSBC, one of Hong Kong's largest banks, introduced approximately 350 digital features last year for its wealth-management and personal-banking customers in the region. The bank reported that it has 2 million customers actively using mobile banking, and over 3 million people have downloaded its PayMe app, highlighting the strong demand for digital banking services in Hong Kong.
By fLEXI tEAM