Industry Insights: Your Branch on Fintech

This Is Your Branch.
This Is the World of Fintech.
This Is Your Branch On Fintech.
Get Used To It.

The days of branch transformation are far from over. And financial institutions are being pulled more intensely in all directions: More, faster, better digital services? Destination branches? Scoop up shorter-term savings or play to the long-term strength of customer engagement?

One thing is sure—any direction you head can be a winner if you take care of the technology underpinnings. And not just fancier apps and snazzy artificial intelligence. In the end, these are still only interfaces. You need to get the back office beefed up, streamlined and flexible to support your customer services. (Of course, you also need to do whatever you decide to do, without breaking the, ahem, bank.)

But what’s the role of the branch in all this? If you follow the industry press day by day, there are examples across the array of strategic priorities. Here are a thought-provoking few we’ve recently spotted.

Branches Keep Disappearing. Banking Exchange. First, the news, with its continuing drumbeat of branch closures. But does this mean branches will all go away? Hardly! A hefty 89,000 are still operating. They’re especially important to community banks and credit unions, which cultivate personal touch relationships and think of their accountholders as family.

Can Community Banks and Credit Unions Survive in Today’s Digital World? Financial Brand. Now for some better news, though you’d never know it from the headline. The answer is, “Yes, if…” Engaging with customers on a personalized level is among the conditions. Makes sense to us. Now, about the difference between “personal” and “personalized…”

If you subscribe, this recent Credit Union Journal article speaks to just this point, How Personalized Teller Machines Are Boosting Business at Coastal FCU. We think the experience of this 2.9B credit union applies to a much wider range of financial institutions. And American Banker reports a similar conceptual model for large banks in its article, Digital Banking Priority: Make It Personal.

Here’s another take on Disruptors versus the Human Connection, this time from a big bank’s strategy for serving investor-class customers. This Banking Exchange article, which by the way acknowledges that that the investor threshold is lower than ever before, discusses the big difference between buying a commodity and trusting an advisor.

Let’s wrap up with some more confirmation of our prediction for the future of branching, in this quick-read article from Financial Brand, Waiting For Branches To Go Away? Don’t Hold Your Breath… It summarizes TimeTrade’s newest “State of Credit Unions” survey. Again, the credit union model is different from banks in some ways, but the tradeoffs between high-tech and high-touch are universal.

About the Industry Insights Series

Alogent’s Industry Insights—this blog and the companion newsletter series—track insights into transformative financial technologies as they happen. Our diverse team of experts pulls the threads together and weave in thoughtful—often actionable—analysis to help banks and credit unions keep their competitive edge and meet new generations of consumers where they’re going next.

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