TECHNOLOGICAL BRANCH INVESTMENTS IN PHYSICAL BRANCHING STRATEGIES OF SMALL AND MEDIUM SCALE BANKS

Year 2017, Volume: 4 Issue: 1, 199 - 212, 30.06.2017

Selman Ortakoy

https://doi.org/10.17261/Pressacademia.2017.535

Abstract

Despite the increasing trend in
online channels, small and medium-sized banks, whose physical coverage is still
low in Turkey, are still required to invest in physical channels. In that
sense, investments in technological branches could be an alternative for banks.
The technological branches, hybrid channels between the physical branch and the
internet/ mobile channels, are also presented as a different channel model in
order to increase the penetration of the bank's new geographical locations. In
this regard, XTM Branches of a medium scale Bank has been taken as a
technological branch example. The bank's XTM Branch investment and the physical
branch option have been compared to a cost-based approach. It has been
questioned how many additional potential locations in Turkey could be chosen in
accordance with this Bank’s Branch Location Decision Parameters if the Bank
decides to invest in XTM Branches rather than classic physical branches.  

Keywords

Technological branch, XTM branch, banking, branching strategies

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