LISLE, Ill.—Another study shows that branches are not dying—due in part to the rise of online fraud.
Despite increasing online and mobile banking alternatives, almost two-thirds (61%) of Americans surveyed still visit their bank branch at least once a month, while three-quarters (73%) believe that bank branches will still be needed in 10 years’ time, according to a survey of more than 2,000 U.S. consumers from Glory Global Solutions.
Consumers say face-to-face contact is what they value most when visiting a branch (28%), but the research suggests trips to the bank are also driven by trust and a fear of online transaction security. More than half of Americans (56%) think a face-to-face transaction is safer for their account information than online banking, with a third (33%) considering it “significantly” safer, the study shows.
Glory Global Solutions noted that consumers are demanding an evolution in the relationship with their bank branch, with convenience featuring heavily in consumers’ wants and needs. Nearly half (46%) of all Americans would like to see longer opening hours from their bank branch in the next three years. More than a third (35%) would want shorter lines introduced in the future, while almost a third (30%) would like to have a more personalized service.
“Nevertheless, the research indicates that branches have a great opportunity to remain relevant in today’s market alongside online and mobile technologies, by tapping into customers’ need for human contact and providing the services that people are uncomfortable sourcing online,” the company stated. “Almost three-quarters of Americans (70%) would choose to carry out at least one of a range of large-scale or complicated services (e.g. applying for a loan or mortgage, opening or closing an account, or asking for advice) in branch, even if there are alternative telephone or online methods available. This provides a significant high-margin market for bank branches to exploit for years to come.”
“The fact is that people are emotionally tied to branches – they trust them,” said Joe Gnorski, vice president of marketing and sales operations at Glory Global Solutions. “Even when attractive alternatives exist – like telephone or mobile banking – many customers feel comforted and reassured by an in-person interaction, so banks need to be thoughtful about scaling back their branch network too far, too quickly.”
Gnorski added that the research highlights a clear role for branches going forward.
“But this requires transforming them into more attractive and flexible spaces to do business – locations that offer higher-margin services with a genuine ‘human touch,’” he said. “Key to this is getting financial experts out from behind the teller window and onto the bank floor to interact more closely with customers and offer the complex services they demand – on their terms.”