HDFC Bank is increasing focus on its two-member mini-branch model, with plans to increase the network from the existing 280 to 500 nationwide by the end of this fiscal.
The two-member branch, which is a 250-350 sq ft facility with all the amenities available at other branches, provides the entire bouquet of its services, including phone and Net banking and international credit cards. This concept has been introduced as part of its target of bringing 10 million families (or 40 million Indians) within the banking fold.
According to Madhusudan Hegde, Head - Branch Banking South, not only do these branches involve a much lesser capital investment than the usual ones, but they also break even faster.
“Since we introduced this concept, we have seen that these branches can break even in just about 36 months — it is a cost-effective model,” he told
While a typical branch takes Rs 25-30 lakh to set up, including an ATM, a two-member facility requires just Rs 7.5 lakh.
The bank, which inaugurated its 15 th two-member branch in Andhra Pradesh in Medak district, will be opening 10 more in the State in the next couple of weeks, followed by another eight in Tamil Nadu, which currently has 17, by September-end.
These branches are doing an average of 12-15 transactions a day (excluding ATM transaction), building up a customer list of an average of 750 in the first year of operation. As these facilities are being set up in un-banked areas, the branches are tapping the agriculture and SME credit market.
Why two-members? “Because, it is our belief that two pairs of eyes are better than one (in handling banking transactions),” Hegde said.
amitmitra@thehindu.co.in