Aug. 28, 2020 (Courtesy of the Jacksonville Business Journal)
Digital capabilities for banks and credit unions have become increasingly important over the last several years, but when physical branches had to be closed completely, those capacities became vital.
When the pandemic began to spread within the U.S. in most banks and credit unions closed the doors of their branches completely or kept only drive thrus open. While some physical branches have begun to incrementally reopen, traffic remains considerably lower than in pre-Covid days because customers were finally thrust into the digital world, lowering the need for bank tellers and in-person transactions.
BBVA USA Head of Retail Larry Franco told the Business Journal that traffic plummeted by a third almost immediately when the pandemic hit and remains down by about a quarter. Franco expects that even as things normalize, a 15% to 20% decrease will be the new normal for those branches.
“We have seen an increase in customers adopting our mobile banking processes and taking advantage of our tools,” Franco said. “We’ve seen an increase in terms of customer usage for routine transactions, like depositing checks, checking balances, transferring money, some of the more routine transactions you would see over the counter have now started to take place through digital means.”
The bank had to look county by county at the needs of their customers to determine which banks should be closed and which needed to remain open. They didn’t want to leave rural areas in the dust, with no one to attend to their financial needs.
In order to provide those touches, banks and credit unions that are open have instituted precautions and protocols to keep customers and employees safe— which is no small task.
At BBVA, they’ve put plexiglass barriers at teller lines and desks for those who want to still sit face to face. Face masks are also required and there are decals demonstrating six feet apart spaces in the lobbies while patrons wait. They’ve also added filters to improve the airflow and circulation within branches and nano-septic self-cleaning skins for door handles.Jimmy Lovelace, senior vice president of member experience at Community First Credit Union, said that the branch model hasn’t changed but instead, resources are reallocated to means customers are more comfortable with. Their branches are operating at full service and most meet by appointment, but the credit union is also offering a centralized express team so that customers who aren’t comfortable visiting a branch can still get connected with someone right away.
“We’ve seen about a 30% decrease in walking traffic, but we’ve matched that increase in call volume to our member experience center and express team,” Lovelace said. “So, I wouldn’t call it so much a decline in traffic, as much a migration of that traffic.”
Ameris Bank’s lobbies remain closed, but CEO H. Palmer Proctor said that their customers have been extremely resilient through the pandemic in adapting to the capabilities that were available to them. There were a lot of late adopters that have now begun to embrace the technology. They haven’t even heard any complaints about branches remaining closed, which to Proctor is a testament to Ameris’ ability to service their clients even without a physical space.
In fact, Proctor views it as one of the few silver linings of the Covid-19 pandemic: new levels of technology utilization among clients that were reluctant.
The role of branches is evolving and the pandemic is only causing Ameris to further optimize their network. They’ve closed some branches where they had a tighter footprint or another nearby location and moved people from lease locations and into mortgage offices, in order to eliminate additional costs.
“The generation that likes to go in is starting to age out,” Proctor said.
Proctor said some needs need to be met in person, for commercial customers especially. However, he believes using appointment systems can be a more efficient method of still meeting those needs.
While things are changing, Regions market executive for Jacksonville Jim Richardson said that banking remains a relationship business that still requires some interactions, especially when it comes to the SBA’s Paycheck Protection Program and the individual needs of customers impacted by Covid-19.
For Richardson, they are prioritizing both investing in technological capabilities, while also balancing high-touch customer needs that require skilled personnel.
“We pride ourselves on being responsive and accessible and having a huge sense of urgency for our clients,” Richardson said. “Our touches have increased dramatically with out clients to make sure we’re there for them.”