Seoul: South Korea’s four major banks will close more offline branches by March, despite their record interest income in 2024, amid a growing demand for mobile banking services, the lenders’ data showed Sunday. The country’s four major lenders — KB Kookmin, Shinhan, Woori, and NH Nonghyup — are expected to operate a combined 3,160 brick-and-mortar branches at the end of March, down from 3,330 at the end of 2023, according to the data.

According to Yonhap News Agency, Shinhan plans to reduce the number of its branches by 57 during the mentioned period to operate 665 outlets by end-March. Woori plans to shut down 52 offline bank branches over the cited period to run 659 outlets, with NH Nonghyup and KB Kookmin planning to reduce 36 and 25 outlets, respectively, to 1,064 and 772. A KB Kookmin official stated that the decision to integrate outlets within a range of 1 kilometer is aimed at providing more convenient face-to-face services to customers in more comfortable and spacious outlets.

Contrarily, Hana Bank plans to increase the number of its outlets from 597 to 602 during the same period. Critics argue that the reduction of brick-and-mortar branches could cause inconvenience for elderly customers who prefer face-to-face banking services. Despite these concerns, the trend of reducing offline branches is unlikely to reverse, as more people conduct banking via computers or smartphones without visiting branches.

The emergence of internet-only banks in recent years has transformed the banking landscape in South Korea, one of the world’s most technologically advanced countries. These internet-only banks provide services around the clock without face-to-face contact or physical branches. Traditional banks have also expanded their mobile banking services to remain competitive and meet the growing demand for digital banking solutions.