The strategic role of the branches becomes clearer. Increasingly, banks and credit unions are introducing radically redesigned facilities, with smaller footprints, advanced technology that not only allows for self-service but also a personalized experience, and much better-trained employees who fill vastly different roles.
According to banking research and advisory firm Bancography, the rapid rise of digital banking has sharply reduced visitor traffic to branches – by 35% to 50% in most institutions over the past five years. More than just a drop in volume, the nature of customer interactions has also changed. As a result, a larger portion of customers are now coming to visit branches to open accounts, seek financial advice, or complete a complex transaction.
To the extent that the outsourced transactions are routine and those that remain are more likely to generate revenue, industry transformation of the industry could be a positive outcome, observes Steven Reider, President of Bancography. Others agree with this view.
“The branch remains a critical customer touchpoint,” wrote Andrew Beatty, Head of Global Next Generation Banking at FIS, in Finextra. “It’s a physical manifestation of the bank’s brand and everything it stands for. The branch helps build customer trust, especially with the banks, which often play a huge role at the heart of the community.”
Key Point of Differentiation
As digital technology has taken over many basic transactions, the traditional branch and counter model of waiting in line, getting cash or cashing in a check has become far less typical. This may interest you : Air Traffic Control can’t handle summer travel, United Airlines says.
Even with more complex transactions like applying for a loan, many consumers are now beginning them on digital channels and then visiting the branch as their final destination, making them a crucial link between the digital and physical worlds, Gina Bleedorn, chief experience officer at Adrenaline, tells The financial brand.
“While transactions may not be as important, banks and credit unions could be missing out on an opportunity for human connections,” says Bleedorn. “For many municipal financial institutions that cannot compete with large banks in terms of mobile capabilities, the branch is a differentiator.”
But as the role of stores has changed, so has the role of cashiers and other store associates, Beatty observes. A long-standing trend that has received new impetus is the creation of “full-service bankers” — a hybrid role that mixes the skills of a personal banker and a traditional teller.
These employees must be knowledgeable about all aspects of branch banking and be able to provide advice and offer a range of products, often based on a personalized picture of a customer’s financial situation. “From a banking perspective, this elevates the branch banker’s role into a trusted advisor and builds customer retention and loyalty,” explains Beatty.
Automating Transactions to Focus on Advice
Branch remodels are not new to banking. To see also : Retail Branch Strategy: High Tech, High Touch & Highly Trained Staff. More than 20 years ago, the now-defunct WaMu pioneered radical store design with its Ocasio concept, which replaced counter windows with free-standing counter switches.
But it has taken the surge in consumer digital adoption, fueled by the pandemic, to push more institutions to shift away from the traditional. The trend is gaining speed. Regions Bank is transforming many of its 1,300 branches to focus more on service than basic transactions.
“We got rid of the traditional dichotomy of the teller and the banker. If you walk into any new branch, you’ll see no teller line.”
Regions uses interactive ATMs — including live two-way video — to efficiently support basic transactions so human bankers can focus on advice and high-value interactions, says Shawn Bradley, EVP of Retail Network Strategy and Design at Regions, in an interview . Read also : West Branch’s music program wins national honor.
The regions have developed a technology tool called Greenprint that allows bankers to better speak to small business clients to outline plans and the next step they should take on their financial journey. The bank employs rigorous training and education to enable all employees to perform all functions at a client.
“We’ve done away with the traditional dichotomy of teller and banker,” says Bradley. “We design our stores around the experience. When you enter a new branch, you don’t see a checkout line, but individual bankers and stations where a customer can meet all their needs.”
In all new branches, Regions creates open, welcoming spaces staffed by advanced-skilled bankers like the team pictured above at a new branch in Charleston, S.C.
5 ways to connect your online and offline banking experiences
Join this free webinar as we dive into five key areas that can help you connect your online and offline customer experiences to drive more membership growth for your local bank or credit union.
WEDNESDAY, AUGUST 3 AT 2:00 PM (ET)
Enter your business email address
A Credit Union Opts for ‘Experience Guides’
Branch transformation isn’t just for big banks. Solarity Credit Union introduced a modern branch concept in spring 2021 as the world opened up again after the pandemic shutdown. Instead of a traditional layout with checkout lines, routine transactions are handled by self-service “smart ATMs”. Former telleres now act as “branch experience guides,” helping customers navigate the new ATMs, offering digital banking know-how and connecting them with credit or mortgage experts.
Solarity initially piloted the concept before the pandemic, but has since switched all six stores to this model, reports CEO Mina Worthington. The transformation has increased employee efficiency and improved customer satisfaction, she says. Waiting times, which customers often complained about in the old branch model, are no longer an issue, says Worthington. “Members feel empowered to have more time in their lives because they have an easier way to conduct their financial transactions,” she says.
Solarity’s Member Satisfaction Score (MSAT) is up 80% in a year, CEO reports. The score rose from 45 points in April 2021 to 81 in March 2022, even as the percentage of heavy branch users fell to 9% from 15% before the pandemic.
Worthington strongly believes that a consultative approach is key to the future of community banking. However, it will take some work to get there. “Our members and customers do not see us as a point of contact for advice. And we want to change that,” she said in a previous interview. The new approach to branch banking is an integral part of this evolution.
Read more: 3 Keys to the Future of Banking: Partnerships, Openness & advice
PNC Goes Small and Automated
In June 2022, PNC also announced that it would transition around 60% of its approximately 2,600 stores nationwide to a technology-focused model over the next five years. These branches will eliminate counter windows and move basic transactions to kiosks so staff can focus more on providing financial advice.
The wide adoption is the culmination of what PNC began in 2018, when the bank began opening “solution centers” instead of branches. These 2,500-square-foot locations combine physical and digital banking, allowing customers to consult with staff and transact through ATMs, kiosks and video kiosks.
“The goal is to provide spaces that customers feel comfortable in,” said Kevin McCann, executive vice president and national territory executive at PNC. “We wanted to build a partnership relationship and use our devices and environment to work with customers to achieve their financial goals.”
Read more: Why bankers aren’t giving up branches despite digital’s explosive growth
A Greater Focus on Knowledge
As banks and credit unions transform branches into experience centers providing financial advice, their employees will need new skills, observes Bleedorn. New employee positions in the branches are far from entry-level. They are a much higher level of employee than most cashier jobs and often require expertise in cross-selling and digital enablement, as well as in-depth knowledge of banking products. “It requires a wholesale workforce shift,” says Bleedorn. “Banks and credit unions need to invest in their employees and in more training, including for salespeople.”
Working in a bank branch too often was a dead-end job. Now it has long-term career potential again.
Solarity’s Branch Experience Guides are better trained than average cashiers, Worthington says. While cashiers “mainly took orders,” these leaders have a greater ability to engage in conversations and interview members to get to the bottom of their needs.
At Regions, Bradley finds that branch banker development has propelled him into a long-term career with greater room for advancement. The bank has even received more interest from branch employees working at competitors who see more opportunities in roles that allow them to develop their skills.
Regions typically look for employees with a strong customer service attitude and then train them with skills and banking knowledge to understand and support customers. “It’s really about a customer experience mentality first, because we’re going to train them to be bankers if they don’t have that background,” says Bradley.
