The State Bank of India (SBI), India's largest lender, plans to open 400 new branches across the country in the current financial year (FY25), despite a rise in digital banking, with nearly 89% of transactions happening outside physical branches. SBI Chairman Dinesh Kumar Khara emphasised the need for branches to provide in-person services like wealth management and financial advisory. The expansion focuses on rural areas to improve financial inclusion for the unbanked population. With these additions, SBI's network will grow to 22,942 branches, balancing physical and digital services to cater to diverse customer needs.
The State Bank of India (SBI), India's largest lender, is bucking the trend and plans to open 400 new branches across the country in the current financial year (FY25). This comes despite a rise in digital banking, with nearly 89% of transactions happening outside physical branches.
SBI Chairman Dinesh Kumar Khara explained the decision, highlighting the importance of branches for specific services. While digital transactions dominate for everyday banking activities, services like wealth management and financial advisory require in-person interaction and personalised guidance. These specialised services are often more crucial for customers in newly developing areas where digital literacy may be lower.
The expansion plan also prioritises rural areas. Last year, SBI opened 59 new branches in rural locations, and this focus is expected to continue in FY25. By bringing banking services closer to rural communities, SBI aims to improve financial inclusion for the unbanked and underbanked population, estimated to be around 190 million in India.
With the addition of these 400 branches, SBI's nationwide network will reach 22,942 branches. This extensive network ensures easy access to banking services for millions of Indians, especially those in remote or less developed areas.
While digital banking offers convenience and accessibility with nearly 98% of all SBI transactions happening digitally, SBI's strategy suggests a future where physical branches and digital services coexist. Branches can provide a human touch and specialised services for wealth management (managing investments), financial advisory (personalised financial planning), and loan applications, while digital platforms offer ease and efficiency for everyday banking needs like checking account management, funds transfers, and bill payments. This approach caters to the diverse needs of a vast population with varying levels of technological comfort and financial needs.
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