We have been very impressed with Raleigh, N.C.-based Coastal Federal Credit Union, which has deployed 36 Express Teller machines designed by uGenius Technology to supplement and sometimes replace traditional tellers. These are advanced ATMs that facilitate cash and check deposits, cash and coin withdrawals and official check withdrawals. Via the video/audio component, they also enable customers to speak with and see a bank customer service representative to discuss their transaction.
Coastal can handle 95% of all transactions that normally take place on their teller line, and the branch can be run remotely by their call center via technology and video link. This dramatically lowers branch cost.
This strategy certainly has a lot of appeal for credit unions that need to serve corporation campuses or stay open longer hours, but there is also a lot of potential for large banks that already have an extensive footprint as well.
Banking Strategies described how putting the ‘automated teller’ in automated teller machines enables banks and credit unions to expand their networks at low cost. Click here
for a PDF copy of the article Automated Tellers=Micro Branches?
Ken Cline (right), Managing Editor of Banking Strategies Magazine, asks David Kerstein, President of Peak Performance Consulting Group, “Why are some branches more successful than others? Is there a ‘Secret Sauce’? What should financial institutions be doing today to position themselves for the future?”
Put this in the category of inexpensive, good ideas, smartly executed.
Austin, Texas based Amplify Federal Credit Union (www.goamplify.com) tailored their website to support the University of Texas Longhorns football team. Note the football integrated into the logo, burnt orange school color, message tailored to the Texas/Alabama game.
Amplify is particularly innovative in their products, technology, and retail relationship strategy and I thought this was a great example of creating a greater sense of community with web users.
As more customers (or credit union members) access the bank on-line instead of in-person, we need to find ways to create increased relevancy and immediacy. There are expensive to use the web and social media to build greater personal ties and relationships, and there are simple ones and this is an example of paying attention to what’s important to customers today (and in Texas, college football is always important to your customers!).
While the total number of bank branches continues to grow (albeit at a slower rate), the number of in-store branches declined over the past year. What’s the future of in-store branches?
Different banks, different strategies.
Wells Fargo has the most deposits within its in-store footprint, but US Bancorp has been most aggressive at adopting the strategy and tops the list with the most in-store branches.
Citizens Financial Group, which holds the second largest amount of deposits at its in-store branches, has been particularly innovative. In October they opened a “branch” within a Dunkin’ Donuts location in Massachusetts. This small facility (about 250 sq. ft., half the size of a typical supermarket branch), trades off-high grocery store customer traffic for high frequency: daily trips for a “cuppa” and donut.
Meanwhile Bank of America has reduced their in-store footprint out of concern that in-store facilities were siphoning volume from its other branches. Maybe they’d be better off with more 500 sq. ft. in-stores, and fewer 5,000 sq. ft. traditional facilities!
Our take: as transactions continue to migrate out of branches, banks will open more small, low cost branches in traditional retail footprints such as strip mall store fronts. This will bring them closer to their customers and keep costs down. But the line between in-store and traditional branches will become fuzzier, to the benefit of those banks that have learned to successfully manage and grow in-store facilities.
SNL Financial’s Bank & Thrift Industry News recently published an excellent article on this subject, which they have generously given permission to reprint here: SNL Financial: What’s in store for in-store banking? (PDF file).