Unemployment is thriving and computer technology has contributed to it. As culled from BloombergBusiness report, FirstRand Ltd is planing to close branches and dismiss workers at its South African retail-lending unit.
This is so because customers have switched to digital banking and the establishment has to respond to that and as well manage the consequences of the deteriorating economy.
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According to Vanessa Hattingh, a representative from Sasbo which is a labor union that represents more than 50 percent of FNB’s staff, about 600 positions will be lost at First National Bank, and 10 percent of the bank’s branches will be affected.
Precisely, 40 branches will shutdown with another 31 reducing the number of people it employs. It was however disclosed that 500 people at the Johannesburg-based company may be able to apply for other roles.
Hattingh said it’s unfortunate that “the use of biometrics and electronic channels can mean job losses. For the banking industry, the broader economic issues are real. Retrenchments aren’t good for the people or the country,” she wailed.
As gathered, FNB refused to precisely state the number of jobs that will be lost but nonetheless, remarked that no full-service branches are affected and that the bank is continuing to extend its network of ATMs.
Reporting this, Bloomberg related that the downsizing process which started in February was meant to improve efficiency and remove duplication as more customers are now using the Internet and mobile phones to transact.
Meanwhile, an analyst in Cape Town identified as Adrian Cloete explained that “If a bank can’t grow its revenues at a decent level, it needs to look at getting cost efficiency.”
The bank according to Cloete, “will try to reduce costs through natural attrition of employees and using smaller, new format branches that have lower rental costs. The operating environment and…revenue growth, has become very challenging,” he added.