The expression “brick and mortar” refers to the physical presence of an organization or business in a building or other structure. It is generally used to compare physical stores, where shoppers visit the store, talk to staff in person, touch the product and buy from the company, with fully online stores that have no physical presence.
Usually used by entrepreneurs who do business online, the expression describes the bank and the customer communicating physically and face to face. It is often used when commenting on digital banking and describing the cumbersome structure of traditional banking. It is generally argued that brick and mortar banks will find it harder to compete in the digital space with web-based online banks or fintechs.
Physical and digital banking side by side
Today, most banks work in a hybrid way: branches both provide services and direct customers to digital channels. Fully digital banks, on the other hand, can offer lower fees because they have no branch costs.
The physical branch keeps its advantages, such as a sense of trust, advice on complex transactions and the need for cash. Digital channels have the edge in speed and accessibility.
Bank strategies focus on balancing these two models according to customer segments.
