In the evolving landscape of global retail banking, divergent approaches to branch banking are emerging, shaped by the dual forces of digitalization and the enduring value of physical branches. This delicate balance between digital and physical channels is critical, and varies from market to market, based on customer needs, technological capabilities and competitive landscape.

The past few years have witnessed significant shifts, with some regions experiencing drastic reductions in branch networks. For instance, Dutch bank branches have declined by 93% since 2001, and Sweden has seen a 47% fall since 2014. However, despite these trends towards contraction, the push towards digitalization is not uniform across all markets. Some countries such as India are actually expanding their branch networks, particularly in semi-urban and rural areas, as private sector efforts aim to reach new customer segments. Other regions, like the United States, where nearly 60% of consumers would not want to use a bank that has no branches, or Hong Kong, where face-to-face service norms remain strong, seem at a stalemate with branch closures.

Generational preferences will have a significant role in shaping retail banking strategies in the years to come. How banks approach branch closure and redesign, particularly those that truly achieve a comprehensive front-to-back value stream redesign, will also determine whether cost reduction and customer satisfaction can be achieved simultaneously.

What's certain is that the strategic balance between maintaining traditional service channels and embracing innovative delivery methods is crucial for banks worldwide. This balance reflects a deeper understanding of local customer bases and the complex dynamics at play in the global banking sector. As banks navigate the challenges of technological capabilities, economic pressures, and changing customer behaviors, the future of branch banking will likely continue to evolve. This evolution will balance the global trajectory of banking practices with market-specific dynamics such as infrastructure and sociocultural factors.