Many American consumers know what to expect when they see a bank branch. Typically, the front lobby has a few ATMs, followed by bankers sitting at their desks and tellers standing behind the counters. However, the advent of online and mobile banking has transformed the way we perform financial transactions, and visits to the branch are less frequent.
Banks are noticing the trend and are adjusting to customer habits to streamline the banking experience, and even save on some operating costs.
In the past year, 1,343 bank branches closed, according to industry analytics and research firm SNL Financial. While some banks are downsizing their branch networks, others are changing or opening bank branches with a distinct flair – one that is different from what consumers have come to expect of branches.
Here are some ways banks are transforming how customers interact with the bank and their money at a branch:
ATMs have become more advanced. Automated teller machines are undergoing regular upgrades to provide a more convenient banking experience to customers. Recently, many banks have ditched deposit envelopes, and now, customers can even insert cash and checks straight into ATMs.
But, there have been more enhancements. For example, banks such as Bank of America and Dollar Bank have installed ATMs that allow customers to video conference with off-site tellers during extended business hours. Other bank ATMs dispense cash in several denominations instead of only $20 bills. These advanced ATMs are capable of performing up to 90 percent of the transactions that a typical bank teller can do.
Banking caters to the digital lifestyle. Since technology has been integral in changing how Americans consume information, it is appropriate that banks have opted to educate customers through digital channels. For example, Umpqua Bank uses digital media walls that provide information about bank products and services. Customers can interact with these walls, that look like giant tablet devices, to get more information. Furthermore, Umpqua branches offer free Wi-Fi access so that customers can learn to manage their money electronically.
Tellers are moving to the other side. The rapid adoption of mobile devices, from smartphones to tablets, is trickling down to the banking industry, which has welcomed mobile devices to the servicing aspect of banking. Rather than having bank staff sit behind their desks, banks are putting mobile devices in the hands of their personnel. Wells Fargo is currently trying a concept that encourages bankers to walk around the branch with tablets to assist customers.
Another purpose for equipping bankers with mobile devices is that they can also take the opportunity to educate customers on how to access and manage their accounts from their own mobile devices. Once customers learn to conduct banking through online and mobile banking on their own, there is less of a need for the personal assistance from branch staff.
Branches are downsizing. Due to the trends in branch banking noted above, banks are more likely to open new branches that occupy smaller footprints. With fewer traditional teller windows and no bankers sitting at desks, there is little need for banks to pay more for a larger space. Instead of a branch that takes up 4,000 square feet, customers can expect to walk into branches that are 1,000 to 2,000 square feet, without losing access to any branch services.
Look to bigger banks as the trendsetters. Currently, the larger U.S. banks are leading the charge by testing these new technologies and branch-banking approaches. If such branch concepts prove to be compatible with customers' evolving financial habits, they could be the new standard for how Americans interact with their bank branches.
Simon Zhen is a columnist and staff writer for MyBankTracker.com, where he covers banking, financial technology and savings rates.