A new and increasingly popular kind of banking is gaining ground south of the Zimbabwean border. The banking industry is using increasingly cutting-edge strategies to astound current and potential consumers, making the race in digital banking impossible to ignore. TymeBank and Bank Zero, two branchless banks that connect with customers via mobile banking and, in the case of TymeBank, contingents at till points in Pick in Pay and Boxer retailers around the nation, have garnered media attention in South Africa.

This is so revolutionary because banks do not entirely require a physical presence, and this has not yet occurred in Zimbabwe. Zimbabwean banks do use some aspects of branchless banking, but being physically cut off from the outside world is unheard of there. The fact that these branchless banks do not charge monthly fees for bank accounts is notable.

An important alternative to traditional branch-based banking is branchless banking. It enables banks to provide financial services outside of conventional bank locations utilizing delivery methods including mobile applications, USSD channels, debit cards, QR Payments, etc. Branchless Banking has the potential to significantly expand the reach of financial services to underserved and unbanked communities.

According to the Branchless Banking Regulations, branchless banking is the provision of banking services through retail agents, mobile devices, and other channels as an alternative to physical branches and premises. In recent years, real-time communication has been possible throughout the world thanks to the internet. Every element of our life has been impacted, making things simpler. One of the main industries where the advantages of the internet have been effectively utilized is the financial services sector, particularly banking. It has made banking locations independent, ensuring that customers may access banking services wherever they are.

Due to COVID-19 and the worry about being impacted, the banking industry in Zimbabwe has undergone substantial changes recently. Branchless banking has come a long way, although not entirely, thanks to the development of banking-specific technology. Branchless banking has mostly been used in industrialized nations on a worldwide scale. Large beneficiaries are being highlighted by fintech and financial technology providers, which are creating waves across the globe. These technologically savvy banks are alluring because they identify and fix the problems with traditional bank offerings. We don't yet know Zimbabwe's position in the overall scheme of things. A branchless banking account is designed to cater for everyone from different levels of society.

In South Africa

In South Africa, Spot Money just introduced an open banking platform that provides a digital bank account without a monthly cost. Only the Spot Money mobile app may be used to administer this account, and customers can join up there by simply scanning their ID and snapping a photo. They then receive a debit card at their door and two digital bank accounts—one for regular transactions and the other for cashback benefits. This is an illustration of the use of branchless banking by South African banks.

In recent years, South Africa has experienced a boom in the use of free-standing digital banks, with early adopters reporting excellent growth. The development of their digital accounts by traditional banks, who also followed suit, has compelled other players in the banking industry to alter their tactics.

The South African market is becoming more and more saturated, and significant firms in the banking industry are participating by making use of their economies of scale. Notably, FNB introduced its "Easy Zero" account before Bank Zero even began to exist. Due to its distinctive offering of an open financial services marketplace that is connected with other financial service providers, Spot Money's local launch has also raised competition in the local digital banking field.

However, the unstable economy in Zimbabwe has compelled banks to be innovative and embrace new strategies to maintain profitability despite the decline in loan intake. As a result, banks have been forced to depart from their traditional core banking activity of lending. Zimbabwe's banks already rely on digitization to stay solvent in an economy plagued by unmanageable inflation, therefore branchless banks would function quite well there.

Advantages of branchless banks

Branchless banking appears to save money by eliminating the need for physical locations. Since all transactions may be completed whenever and anywhere, it offers customers increased convenience. But today's branches wouldn't exist if that were all there was. In reality, during the past 15 years, the number of branches has gradually expanded. The popularity of branchless banking is also largely due to time savings and convenience. Another factor that has increased branchless banking's popularity is hygiene, which is particularly important in these pandemic times. This banking is extremely important in the society we live in now since it is accessible 24/7/365 and people try to access their money at all hours of the day.

Why customers may still prefer bank branches over the branchless banking account

They’re familiar

Residents of far-off cities and rural locations pass by bank branches countless times as they go about their daily lives. It is simpler to go to a physical branch in person rather than a mysterious bank advertised on a billboard when one of them wishes to open a new bank account.

Trust through interpersonal communication

Once a customer establishes an account, the branch is used to encourage bank loyalty. Customers can ask questions and receive assistance from counter employees in selecting the best financial solutions for their needs. Every engagement is an opportunity for the bank to expand its relationship with the consumer and sell more services. Advice and support help to build trust.

Why do Zimbabwean banks stick to branches?

Lower identity theft risks

Face-to-face interaction at the branch helps reduce security threats while also providing clients and banks with more financial and commercial options. An effective defence against fraud is an often-overlooked technique for verifying a customer's identity. Identity theft and impersonation are significantly riskier for criminals offline than they are online.

Revenue growth through cross-selling and self-service

Cross-selling opportunities, customer loyalty, and new account perks all contribute to increased branch revenue each year. Bankers have had considerably more time recently to concentrate on advising and keeping customers.

Improved employee utilization


The Zimbabwean banking sector is currently engaged in a dispute about branch vs. branchless banking as a result of the unprecedented stress test brought on by the coronavirus outbreak. Many people are persuaded that branch banking is dead and that the future of branch lessness seems promising with a third of the world's population not visiting banks limited and many bank branches closing. But this viewpoint is also not new. Although branches might be no longer relevant, the branch vs. branchless argument is much more nuanced.

With the rapid growth of many technology companies, the fear that banks would not be able to keep up with the high-tech competition is possible. Branchless banking is a solution to inefficient branch networks and a way to significantly reduce costs.

However, the first branchless bank, SFNB, had a different story. After a successful IPO in 1996, the company had raised significant capital and had $55 million in deposits at the end of 1997. SFNB focused heavily on developing its widely acclaimed banking software, which was used by 16 of the 100 largest U.S. banks, but left nothing to build its bank. Costs added up to $50 million in losses in 1996-1997, and the bank’s assets were sold at just above book value. Branchless banking is not always guaranteed to succeed.