Absa has allegedly closed up around 79 of its physical bank branches and more than 100 ATMs in South Africa as customers are increasingly shifting their banking activity to digital channels.
These changes are said to inform part of a broader restructuring of Absa’s physical banking network, driven by changing customer behaviour and declining use of branches for cash transactions.
This was highlighted in the group’s interim results for the six months period – ended 30 June 2026. The bank however says its digital customer base continues to grow strongly during the first half of the year.
Across the Absa Group, the number of active digital customers is said to have increased by 14% year-on-year. It is also reported that, In South Africa, digitally active customers rose by 10% to 3.8 million, while the Africa Regions recorded a 21% increase to 1.6 million.
South Africa also recorded a 4% increase in active transactional customers, which Absa said highlighted “the role of digital capabilities in supporting customer engagement, driving transactional activity, and deepening customer relationships.”
The shift towards digital banking has had a direct effect on the bank’s branch network. Absa said that “evolving customer preferences and behaviour drove the transformation of the distribution network”.
The Bank has also noted a decline in branch cash transaction volumes, which contributed to the decision to reduce its traditional footprint.
The bank’s ATM network is also said to have declined by 2% to 4,976, equivalent to more than 100 fewer machines. At the same time, Absa increased the number of smaller Sales and Service outlets by 76% to 215. These outlets accounted for 37% of the bank’s total network, compared with 22% in the previous reporting period.
The changes come as Absa’s customers continue to face pressure from higher living costs and elevated levels of household debt. The bank indicated that the operating environment remained challenging during the first half of 2026, with economic stabilization seen towards the end of 2025, disrupted by renewed inflationary pressures linked to geopolitical uncertainty in the Middle East.
“Consumer inflation increased from 3.1% in March to 5.0% in June, largely driven by higher fuel prices,” Absa said. The South African Reserve Bank also raised the repo rate by 25 basis points to 7.0% in May.
Absa has said that these pressures meant that “consumer affordability remained constrained by elevated debt levels, modest real income growth and higher fuel and essential living costs.”
Some parts of the group were consequently under pressure. Personal Loans recorded a headline earnings loss of R38 million, which is unchanged from the previous year.
Credit impairments also increased by 5% despite the smaller loan book. In Corporate and Investment Banking, Transactional Banking headline earnings fell 13% to R1.508 billion, partly because of lower revenue and higher credit impairments.
Absa says pricing pressure in Working Capital Solutions and increased competition offset some of the benefits from higher transaction volumes.
Additional Sources: BusinessTech SA, Business News Nigeria
