The Financial Brand recently posted some interesting statistics related to what industry pundits have proclaimed as the inevitable fall of the bank branch. Apparently one in three financial institutions plan to open NEW branches this year, while 8.76 percent of banks and credit unions reduce the number of branches they currently operate:
- 4.7 percent will increase the number of branches by 10 percent
- 11.3 percent will increase the number of branches by 5 to 10 percent
- 17.9 percent will increase the number of branches by 1 to 5 percent.
- 44.2 percent are making no changes to their branch bank strategy.
Apparently only one in 11 financial institutions are planning any branch closings.
What’s going on? The news has been reporting reductions in branch banks for some time now. What can account for this reversal?
It’s really simple, these are new branches with a new purpose and a new attitude. To paraphrase the old car jingle, “It’s not your father’s bank branch.”
The new generation of bank branches are enabling a new “brick and click” strategy Banks are instituting a new series of “smart” branches to make the most of technology and offer new types of customer service.
As reported by Jim Marous, a new guide produced by space consultants Solidus reveals that the next generation of bank branches are going to be designed with digital banking in mind. The new generation of branches are being adapted to suit the needs of their regional market and their niche consumers. Digital and physical banking are converging in a new way that makes bank branches not only more profitable but essential.
The new branches will provide human contact to support digitally powered services. Locations will be determined by proximity to consumer centers, business corridors, and commercial zones. The size of branches will shrink to smaller spaces of less than 1,000 square feet. The whole idea is to support customer convenience.
Part of this drive to offer a new kind of human face on an increasingly digital service is what Accenture has come to term the Bank of Things. Just as the Internet of Things makes it possible to connect devices anywhere on the planet, the Bank of Things will connect financial services such as retirement planning, health care, real estate, loans, credit cards, etc. The new branch bank is providing a foundation to make that personal connection with digital consumers.
The role of the branch banker will become more that of a sales associate or advisor rather than handling transactions. The nature and types of services will expand, and the branch banker will be cross-trained in order to serve as the guide through this new digital Wonderland, helping customers navigate various options and manage their digital banking needs.
Technology will become an enabler for branch bank efficiency rather than a substitute. These new “smart” bank branches are going to show customers how to get more from their banking relationship, including new services and new ways to leverage their money. Technology will give customers the tools to access and manage these services, and the branch bank will become instrumental in educating customers about these new services.
People continue to demand human interaction and personalized services in an increasingly digital world. This financial institutions ready to compete are taking a step forward by bringing the branch of the future to a storefront near you. Personal banking services will always be a part of banking, but the role of the banker will change to enable the new digital banking revolution.
What do you seen in tomorrow’s bank branches?
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