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

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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