(Yicai Global) Dec. 26 -- Community banks in China are struggling to acquire new customers and bring in the capital as internet banking extends its reach, leading to branch closures nationwide, Securities Daily reported.

Most community banks are around 25 square meters in area and have one or two automated teller machines with two or three staff, the report said, adding that most shut down due to a lack of customers.

These smaller, local branches used to have extended opening times so customers could visit outside of typical office hours, but the lack of customers has forced them to reduce working hours and visitors no longer have the convenience of banking after they finish work.

The likely reason behind the decline in branch visits is the improvement in China's online financial applications. Customers can now use the internet to carry out simple tasks, like paying bills, so have no need to visit banks in person. The rise of fintech also means that borrowers can use their smartphones to take out loans.

This year through Dec. 25, The China Banking Regulatory Commission shut down 68 branches in Beijing, but the problem is also prevalent in other metropolises, such as Shanghai and Guangdong. The regulator's Guangdong unit shut down 21 community banks in second- and third-tier cities over the period, while the Shanghai division closed 13.