PREMIUM — Citigroup has implemented a digital-heavy, branch-light business approach that extends beyond its National Digital Bank platform, announced in March and currently in testing phase, according to Stephen Bird, CEO of Citi’s Global Consumer Banking.

For starters and relatively speaking, Citigroup doesn’t have many physical branches, and it has no plans of changing that, according to Bird, who spoke yesterday at Deutsche Bank’s Global Financial Services Investor conference. The bank has about 700 branches across six cities in the U.S., and about 2,400 branches in total globally.

“We have competitors for 4,000, 5,000 branches [in the U.S.],” Bird said.

Bird is right, but it’s worth noting that most of the larger banks, including Bank of America and Capital One, among others, are shutting down branches on a net total basis as they move towards digital transformation.

“We project brand to punch above the physical presence by making it digitally pervasive,” Bird said. “I think good strategies are strength finders and our cards business is a highly, highly digital business. The cards business is a digital payments business. The credit cards business was conceived as really a digital business… We are, in the U.S., a nationally recognized brand, but our physical footprint in the retail bank is in six cities.”

So, instead of branches, Citigroup has ATMs. This is a key non-digital component in Citi’s mostly digital strategy, mainly because many markets, including the U.S., are still cash-heavy. In fact, Bird claims Citi’s to be largest fee-free ATM network in the country. The bank “effectively doubled our ATM network globally,” he said.

But aside from ATMs, most of Citigroup’s innovation efforts and investments are focused on digital endeavors, such as its digital bank.

The National Digital Bank, as Citigroup calls it, was first mentioned (but with very few details) in the bank’s March earnings call. National Digital Bank will be Citi’s digital-first consumer banking platform that will be available nationwide. The hope, according to Bird, is that the platform will help the bank grow its customer base through a series of revamped rewards and points programs.

“Think of it this way: we have 110 million customers today in Citi, a whole cohort of those love American Airlines miles, so, they are self-selective members of the American Airlines Club and they love miles,” he said. “Until now, nobody has said to them, ‘why don’t you also earn those same miles on your checking and savings account, you’re going to be able to do that.’”

REWARDS & POINTS

Similarly, the bank plans to offer similar rewards and points with merchant partners such as wholesaler Costco — whose business Citi took over from American Express at great expense and pain a few years ago– and home improvement retailer Home Depot, among others.

The key to offering such programs is data. The bank plans to use the data it already has to identify customer patterns and preferences. Then, based on those findings, it will offer customers personalized rewards and benefits in a seamless, easy-to-use format via the digital bank.

“So, when customers’ behavior tells you, they prefer this type of incentive and then you offer a new way to double up and get that incentive, and if you do in a frictionless way where you can access on your device — we think that’s a good way to start acquiring customers across that spectrum of borrow, pay, save, invest, protect,” Bird said. “This is digital-ecosystem thinking. This is about leveraging the data that is in our system, in a way that can create growth in a natural way, and not get caught up in rate wars.”

But don’t get too excited, though: the digital bank is in early stages of development, and will take at least three years to launch.

For the first quarter ended on March 31, Citi reported $4.6 billion in net income compared with $4.1 billion in the same quarter last year. Today, Citigroup [ticker: C] has a market capitalization of $1.7 trillion.