There may be no physical institution as historically revered as a bank. Community centers and trusted destinations, the banks of our imaginations are cool and quiet spaces housed inside classical limestone buildings. Ceilings are high, floors are marble; words echo. Behind bronze-framed windows, tellers take money from trusting customers for safekeeping or direct them to comfortable chairs where they wait for a personal banker.
Nice try. Banks these days are hardly elegant or imposing. Most have shrunk in size thanks to rising costs of real estate, and many have disappeared entirely, according to data from the Federal Deposit Insurance Corporation. Chase reduced its branch presence by 190 locations, a 3.4 percent decline, from 2012 to 2016. Wells Fargo closed 98 branches, a 1.6 percent decline in the same period. Its peers are even more aggressive. Bank of America closed 243 branches (16 percent) in that period and Citi closed 302 (28.5 percent).
Branches are consolidating locations with lower servicing volume, opening in higher growth areas and renovating existing branches and ATMs. More importantly, they’re evolving into more compact, digitally oriented spaces that incorporate new technology and help branch employees focus on improving the customer experience.
Some end up looking more like Apple Genius Bars than banks.
Citibank’s new digital branches, for example, each feature a workbench with computers where customers can look at their finances with a personal banker at their side. Staffers, equipped with iPads, are available on the floor. While the teller behind the window used to be the standard, it is now seen as an inconvenience. This so-called “banking side-by-side,” however, is thought to be a luxury, and banks like Citi want to make it the norm.
“We have personal bankers here, a manager, head tellers – we have everything a traditional branch has but we’re serving [customers] in a more convenient way, and in a better way, really,” says Solymar Difo, head teller at a Citi digital branch in Miami. “Behind the teller line, there wasn’t much we could do. … You might tell them they have to wait for a personal banker, but then the personal banker is caught up opening accounts or doing other things that this client here in front of you doesn’t have time to wait for.”
Traditionally, the role of a branch teller has been a demanding one for such an entry level, frontline job. Many tellers are often straight out of college. They have to learn about the many different financial products they sell, when to identify a sales opportunity that would require a personal banker and how to quickly sell the idea to a customer to get them to that banker.
In digital branches, however, “there’s not a barrier between you and the client,” Difo says. “Instead of directing them to see a personal banker or make a call [or] go online … I have the opportunity to do all three [myself]. I can educate them, help them online, I can even make the phone call with them.”
While those in the banking industry feel there will always be brick-and-mortar branches, in large part because the business of banking is grounded in trust, and in knowing the person with whom you’re working, the move to digital technologies is expected to grow exponentially.
“Today, four out of every five monetary transactions are completed through our self-service channels, but we still see meaningful opportunities for improvement,” Thasunda Duckett, JPMorgan Chase’s consumer banking CEO, said at the company’s Investor Day in February. “Last year, we had over 400 million transactions being completed through our tellers, 70 percent of which could have been done through our self-service channel. So in the year ahead, you’re going to continue to see us focus on migrating more of these transactions to digital.”