The concept that branch banking is on its way out is certainly not new. Actually, banks happen to be working to supplement traditional customer support channels with digital equivalents for years now – spurred on through the concept that younger generations approach most things online.
The pandemic has brought the main focus on digital banking to the forefront, with TSB announcing the closure of the third of its branches recently. Our research managed to get clear that Covid-19 has taken in irreversible changes to the approach we take to act, even among those previously considered less tech-savvy – 10% of respondents began using digital apps and services for the first time during lockdown, which three-fifths plan to continue with them permanently
Put simply, a vacation to the local branch is becoming synonymous with paper-based processes which are often slow and inefficient. But that's not saying the finish is here for top street branches – instead, the pandemic has caused banks to reassess their value.
Banking like a people business
Over recent years months, COVID-19 has confronted lots of people having a prospect of financial distress that they could never have imagined at the beginning of this season. And despite all the purchase of call centres, internet banking websites and mobile apps, digital infrastructure that banks have built in the last decade was not the panacea that everyone expected.
Banks are realising that customers don't want to do everything online in the end. When their livelihoods and companies are threatened, they do not wish to wait on hold with the call centre-they visit their local branch simply because they know they'll get an answer. And when they're really concerned about money, they need personal advice and face-to-face support from the real human, not just a group of recommendations on a website.
As an effect, the crisis indicates the branch in a different light: it isn't around the periphery, but in the centre of the banking community.
That's not saying that digital banking has failed, or that digital investments have been wasted-it's just that the crisis has highlighted something that must have been obvious all along. Banking isn't just about processing financial transactions; it's about helping people live the lives they want to live. It comes down to making banking simple, safe and rewarding. Nothing is more personal or even more emotive than the usual small business owner's dreams or a family's financial security.
We reside in a network society, that's true-but the network is fundamentally built on romantic relationships, not technology. Bank branches are critical nodes in that network. You cannot extract those nodes and expect everything to function in the same way. So rather than attempting to invent some new way of personal banking interaction online, why not make use of the ecosystems and talent we already have, and give the branch its due like a trusted focal point for that neighborhood?
A new future for that local branch
At the same time frame, those city skyscrapers no longer seem to be gleaming quite as brightly. Although security and regulatory compliance considerations have historically made a lot of lenders up against the idea of allowing employees for you to use home, the pandemic is forcing them to push those boundaries.
With the continuing chance of contagion, people are no more prepared to spend several hours a day packed like sardines into a tube carriage simply to get to the office-and this can be a situation that could continue indefinitely.
Under these circumstances, the branch begins to seem like a beautiful option not only for traditional branch-based functions, but because a decentralised workplace. By giving a safe and secure location where employees can access bank systems, it eliminates the compliance concerns of working from home, while making certain staff aren't obliged to commute into central offices unless what is required. Moreover, using the price of a desk in Canary Wharf estimated around lb100,000 each year, there could be significant cost savings from moving to some more branch-based model.
This is not only blue-sky thinking-it's something which major banks already are actively exploring. Jes Staley, Group Chief Executive of Barclays, went on the record about rethinking the balance between central and native, potentially enabling investment banking and call centre teams for you to use retail branches. With around 70,000 Barclays staff currently working from home because of lockdown, he told the BBC: “There will be a long-term adjustment to the location strategy. The idea of putting 7,000 individuals a building may be a thing of the past.”
Striking a balance with automation
However, if we do see a shift towards much more of a hub-and-spoke model, with increased responsibility shifting from central office to the branch network, branches can't stay locked in yesteryear. The in-branch experience needs to be just as simple, fast and seamless as the web or mobile experience ought to be. Customers won't tolerate queues, paperwork and manual processes, and they'll expect consistent service regardless of how they decide to communicate with their bank.
Offering the best advice and support to each customer across all channels is a challenge that may simply be solved with the right mixture of people, processes and technology. Essentially, you need to try to make the right information open to make the right decisions at the right time and embed those decision support mechanisms into all your customer-facing business processes.
Clear value in intelligent decision-making
Data-driven technologies enabled by artificial intelligence equip banks with the tools necessary to help support their personnel support their customers better with the current turmoil. By implementing solutions to enable intelligent decision-making, banks are empowered to fine-grain their approach to customer care through real-time insights at an individual level, no matter where their client engages.