Japanese megabanks curb hiring amidst digitalisation drive

MUFG will cut new hires by 45% as it aims to halve the number of teller-operated branches.

Major banks in Japan are aiming to rein in hiring and add more automated, technology-driven branches as part of a dedicated effort to cut down costs, reports Nikkei Asian Review.

The country’s biggest bank, Mitsubishi UFJ Financial Group (MUFG), will halve the branches with tellers by 2023 from a total of 515 at present in addition to employing robotic process automation (RPA). In 2020, the bank targets to trim new hires by 45% to 530 new graduates as they shift to automated branches without tellers.

The number of employees that attended the welcoming ceremony of Mizuho Bank and Mizuho Trust & Banking reached, that around 700, which is about half of those that have joined back in 2018. In 2020, the bank is aiming to cut hiring by an additional 20% to just about 550 newbies as it aims to apply RPA to around 2,000 tasks over the six years beginning fiscal 2018

Also read: Japan's mega banks embrace robots to cut costs

Meanwhile, Sumitomo Mitsui Banking’s hiring graduates dropped 17% to 667 as it aims to decrease new hires by 10% to 600 by 2020 Moreover, SMFG is employing an RPA that aims to slash the workload equivalent to the work of 4,000 employees over the next three years.

The ultra-low interest rate environment has been hammering Japanese banks hard as they double down on structural overhauls by trimming their branch and ATM networks in a bid to save costs. Moody's Investors Service estimates that the reforms from the three megabanks alone will result in a 32,000 headcount reduction over the next few years.