The COVID-19 pandemic is redefining how people transact in all aspects of life. Financial services are no exception, evidenced by the rapid adoption of self-service and mobile banking tools.
Routine transactions have been moving to digital channels for some time, but COVID-19 accelerated the shift almost overnight. Recent consumer trends research from Fiserv found that in the first months of the pandemic, 27 percent of consumers increased their use of mobile check deposits, and 33 percent increased use of mobile payment apps.
But that doesn't spell the end of the brick-and-mortar branch. Many consumers want both face-to-face branch interactions and digital capabilities. According to the same research, 54 percent of respondents said they expected to visit a branch within 30 days of it reopening.
No other channel offers the same opportunities for consumer acquisition and engagement as the branch. But to stay relevant, financial institutions can offer choices for how, where and when consumers transact. Financial institutions can take their cue from the retail and hospitality industries, where top brands are integrating high-tech with high-touch.
No other channel offers the same opportunities for consumer acquisition and engagement as the branch.
High-Tech: Speed and Convenience in Transactions
Financial institutions can look for opportunities to extend the benefits of online banking – speed, convenience and self-service – into the physical branch.
For example, routine cash and check transactions account for more than 90 percent of branch visits, making them a prime target for expanded self-service and automation. Financial institutions have a variety of tools and strategies available to automate and simplify routine transactions, including:
Improvements in biometric security measures engender consumer trust in next-generation branch banking. Solutions that use an infrared device to scan the user's palm dispense with consumers' need to carry a card and remember a PIN.
When deployed as part of an overall transformation strategy, tools such as those create the frictionless journey consumers expect. By providing more self-service tools to complete routine transactions, financial institutions can expand access while generating significant cost savings.
High-Touch: Building Trust and Creating Value
There is more to be gained from branch transformation than operational efficiencies. Consumers want exceptional high-touch service with minimal waiting. By making strategic investments in automation, financial institutions can free tellers to deliver the concierge-type experience consumers expect.
It's an easy win-win situation. Consumers spend less time waiting for advice, coaching and answers to complex financial questions. Tellers have more time to focus on consumer relationships and consultative selling. The value proposition is clear: Consumers know their financial institutions understand their needs and can deliver personalized service.
Those changes will not happen overnight. Some institutions may require a shift in staffing models and possibly culture. Tellers will need to be well-versed in products and technology, and their buy-in will be critical or the consumer experience will not match expectations. Financial institutions that do it right, however, could increase employee morale and retention by turning front-line jobs into career paths.
Transformation in Action
There is no silver bullet for branch transformation. The right model will vary by financial institution and possibly between branches.
Financial institutions can start by taking a close look at their data and consumer demographics. What drives consumers to visit a branch? What do they want, need and expect when they walk in the door? What is their comfort level with digital banking? What is the total consumer experience across all channels, and where do gaps and friction exist? With research in hand, financial institutions can craft a strategy that integrates enterprise-wide physical and digital experiences.
Branch-specific strategies can and should be implemented based on consumer preferences. For example, digital self-service branches could extend access in remote locations while teller-staffed branches are maintained in higher density areas. Or financial institutions could decide to install self-service tools in drive-thrus and lobbies while moving all-star staff into universal teller roles.
Financial institutions that build an integrated, strategic plan for transformation will likely find that efficiencies and engagement are not mutually exclusive. Rather, organizations can streamline operations, optimize their branch footprints and secure greater cost savings, while also improving the consumer experience.