Is digital expansion the new branch scaling for banks?

Emirati banks have been on an expansion push into Asia and Africa to capture flows going through corridors from those regions to the Gulf and to bring banking to larger, unbanked populations. Mashreq was the first to receive a restricted license from the State Bank of Pakistan last year to kick off pilot operations as a digital retail bank, and it operates in India, Hong Kong, Egypt, and other countries. Meanwhile, others like Emirates NBD are pushing into markets like India through acquisitions.

But the old playbook for entering a new market has changed: Acquisitions are still on the table, and banks are still investing in physical branches and teams abroad — but as banking becomes more digital, these are far from the only ways to expand in a new market anymore.

For Mashreq, going into a market like Egypt or Pakistan — and succeeding — doesn’t necessarily require boots on the ground. Instead, the goal is rapid financial inclusion without the heavy CAPEX of a massive branch network. “In Egypt and Pakistan, you’re empowering the population to have a bank account digitally with complete ease,” Chief Client Experience and Conduct Officer Rania Nerhal tells EnterpriseAM. That means that “I don’t need to have a presence on the ground as much as I [need to] have a good digital experience,” she said.

Mashreq has been investing heavily in its digital banking journeys, consolidating its apps to make customers’ lives easier, launching an AI-enabled chatbot to handle customer queries and requests, and integrating AI into its business banking dashboards.

All of that falls into the client experience bucket at Mashreq: Where a customer’s experience with their bank years ago was defined by the amount of time they spent at the branch waiting in line or their interaction with a teller or customer service officers — it’s now become much more nuanced. It’s also about your digital journey, the ease of doing your routine tasks, and having access and visibility into your finances 24/7. “The bank’s philosophy is that if a customer has to talk to a human for a routine transaction, the digital journey has failed,” Nerhal said.

At the core of this shift is an AI-powered chatbot that Mashreq tested internally for 18 months before a phased rollout to 300k customers last year. The system handles 120 use cases — from credit cards and loans to savings and deposits — without a single agent transfer in 89% of cases, Nerhal said.

It’s not all about the chatbot though: For markets that are not “high-mass” — think the UAE and other Gulf countries — ultra-high-net-worth individuals are looking for better access and visibility into their finances, which are often scattered across different accounts and markets. In their case, making the digital journey easier means consolidating balance checks, trading, wealth management, and mortgage all through the same app, Nerhal explained.

This also means hiring needs are changing: The job descriptions for both branch employees and contact center officers are becoming more demanding. “They’re no longer involved in [printing statements],” Nerhal says of branch employees. “They're focused on value-add and high-value impact interaction with the client.” When a human is in the loop, it’s for “critical journeys” — structuring a mortgage, discussing investment advice, or negotiating facilities for an SME.

The new hiring mandate: Mashreq now prioritizes “an innovative mindset, deep digital fluency, and strong product knowledge,” she explained. That should all be underpinned by communication skills and genuine customer empathy, she added.

What to watch

The bank has its eyes on turning the physical branch into a boutique “advisory hub” as it continues to introduce updates to its digital capabilities, including plans to update its AI chatbot in 2026.