Safe Deposit Box Industry -Exponential Growth Opportunities
I confess to being surprised myself at how passionate I have become about the humble Safe Deposit Box. Working with partners to develop the concept of a fully automated, insured, 24/7 access, convenient safe deposit box center that can be deployed in almost any city in the world in a matter of months, is a project that has consumed me for the past 4 years. We launched our inaugural MySafe “proof of concept” site in JLT Dubai and will open our second UAE site in the retail lobby of the Kempinski Hotel and Residences, Palm Jumeriah in June. This will be the first 5 star hotel in the world where guests and visitors alike can avail of a fully automated, fully insured safe deposit box service available 24 hours a day, 7 days a week without having to leave the hotel lobby. We will also shortly announce plans for two additional iconic sites in the UAE later this year.
We have been inundated with expressions of interest to deploy across the UAE, in Bahrain, India, Thailand, Sir Lanka, Hong Kong, Greece, Italy, Brazil, Ukraine, East Africa to mention but a few and we are actively working with / exploring investment partners with a view to rolling out the concept in the targeted markets.
MySafe provides a 21st century solution to an existing demand and accepts a leadership role informing the wider market of the benefits of engagement in our convenient service. In April 2019 a European Private Equity Specialist and former Investment Banker with HSBC London described MySafe as follows:
“MySafe represents a fundamental refreshment of the safety box industry, towards an offer that encompasses Fintech technologies and provides 24/7 access. The biggest change in the industry since the 19th Century”
My comments above must seem “Trump like” and I apologize in advance if this puts you off. Honestly it simply reflects a deeply held passion. A belief that our industry is on the cusp of a strategic opportunity to re-energize the humble safe deposit box, make it even more relevant that ever, lift it into the 21st century and develop a strategy to replicate a service that has been delivered across local communities in counties across the world for decades.
Here is an industry sector that can trace its roots back over 150 years. Described in newspaper advertisements as “Steel Box, Dual Key”, it was a revolutionary idea in those days and in many respects, some might say that the traditional Safe Deposit Box remains very much the same concept. Since inception, the safe deposit box service was provided by retail banks and to a lesser extent by the private sector. Historically retail banks delivered these services through the local bank branch network to local communities serviced by that branch. Imagine the changes sweeping across the industry as banks branches dramatically reduce in line with the banks strategic agenda to reduce costs and drive growth through online banking platforms. As a consequence, in many countries across the world the availability of locally based safe deposit box services have been decimated. In some countries, this “local community based” service has been almost eliminated completely.
Let me share some figures to give you a sense of the change sweeping across the industry.
- In the United States Over 11,500 bank branches have been shut over the past 10 years.
- Over 1,700 branch closures recorded in 2017 alone, the fastest rate of decline on record and more than half of the top 100 US banks have reduced their branch footprint by more that 50% in the past 5 years
- In the United Arab Emirates , 75 bank branches shut in 2017 and in 2019, the retail bank of the year for the past 3 years running announced plans for the closure of 50% of their branch network in 2019.
- In the United Kingdom 2,900 bank branches have closed over the past 3 years with a record number of 879 closures announced in 2017, a trend described as “alarming”
- In Thailand just looking at the top 3 banks alone and between them they closed over 100 branches in 2017
- In Belgium over 2,000 bank branches will have closed down between 2012 and 2020
Almost every country you examine has a similar trend driven by the banking sector push for digital transformation and cost reductions. one of the unintended consequences is the decline in bank branch safe deposit box capacity. The dramatic reduction in the availability of locally based safe deposit box services is not a consumer driven strategy. Demand never changed, the banks simply took the view that it was no longer in their strategic interests to maintain / develop / invest in the humble safe deposit box service .
Of course the “traditional safe deposit box industry has seen an exponential surge in growth and by and large these traditional safe deposit box centers provide an exemplary service. They are located in the center or major urban cities and by and large provide an exemplary services to thousands of clients from any one site. The purpose of this article is not to disparage the traditional safe deposit box industry rather to amplify the enormity of the change sweeping across the industry. The challenge the private sector faces is to identify solutions that can replicate / enhance the level of community based services previously provided by the retail bank branch networks.
In much the same way that the deployment of the “humble” ATM from the Banking Hall to the retail high street revolutionised the way society manages personal cash, MySafe set out to develop a concept that would revolutionise the options we afforded the consumer to avail of secure, insured, storage centers for items of corporate or personal value across a network of locations that were convenient and embedded in the very communities they sought to service.
I hope the article will be of interest to readers and initiate some discussion on the potential and how best we in the industry can deliver consumer benefits. We have been excited to note the response from clients, stakeholders and the wider market and indeed take this opportunity to thank our colleagues and friends across the traditional safe depoist box industry for their continued interest and expression of support. If you should have any questions, comments or any interest in exploring the strategic opportunity, please don’t hesitate to reach out.