What is Technology’s Influence on Credit Union Branch Closures and the Future of Branches
Do credit union branches have a place in the growing world of technology? Not so long ago, consumers’ primary way to make transfers, deposits and loan requests was to visit a branch. Now, they transfer funds from home, deposit checks remotely via smartphone camera and request loans with a few taps of the tablet touchscreen. As more financial services migrate to online mediums, it’s clear that the role of the physical branch must evolve to meet consumer needs while the inevitable question arises: Are credit union branches necessary at all?
The argument in favor of branches is that online financial services can’t offer the face-to-face relationships and first-hand guidance that a credit union branch staff can. So, will physical branches weather the mobile takeover? The CUNA Operations, Sales & Service Council and the CUNA Technology Council are leading the initiative to determine what we can expect of branch operations in the next few years and in the future to come. Through in-depth research from the service-oriented and technological standpoints, they’ve released a comprehensive white paper exploring trends and predictions, and are holding a pre-conference workshop during their co-located annual conferences to further discuss this future-determining topic.
White Paper: Is Technology Causing Branches to Close but Service to Thrive?
The Council-sponsored white paper, authored by Jim Jerving and titled Is Technology Causing Branches to Close but Service to Thrive?, explores trends in technological advancement in relation to the function and relevance of credit union branches. It takes the two big-picture perspectives into consideration. The first places weight in consumers’ need for comfort, stating that financial guidance in a face-to-face human environment as well as the role that branches play as a symbol and embodiment of a brand are enough to justify the continued existence of the branch. The other reasons that modern social media has proven the feasibility of electronically-established member relations and that consumers have been proven to engage more actively online than off, declaring the cost of maintaining branches to be irrational amidst the swift rise of mobile banking and projections for imminent online dominance.
Jerving concludes that the branch, as an institution and a symbol, is not going away any time soon. Financial pressures have not yet affected the number of branches being built, but could mean crippling losses for any credit union unwilling to adjust the function of the branch in a world of mobile dominance. Jerving posits that the front line teller position is one key element of this evolution – the role of the teller will need to expand into a more diverse and knowledgeable representation of the branch so that consumers have reason to trust and depend on the staff’s resourcefulness and prowess. The factors that will keep consumers returning in person are the incomparable comfort of human interaction during life-changing transactions and the access to guidance in times of intimidating technological adjustment.
Workshop: The Future of Branches
To prepare the credit union movement for these mobiles trends and online factors, the Councils will hold a joint workshop presenting their research and suggestions for credit union branch strategy. The session will be presented in a pre-conference workshop for the co-located CUNA Operations, Sales & Service Council Conference and CUNA Technology Council Conference, both taking place September 22-25 in Hollywood, CA. The CUNA Operations, Sales & Service Council Conference, hailed for its peer interaction and networking opportunities, gathers the industry experts and top credit union leaders to provide insights on the state of credit union operations, both current and in the future. Addressing the other half of the coin, the CUNA Technology Council Conference presents attendees with the newest developments in technology applicable to credit union service and strategy. With the question of online futures at the forefront of so many credit unions’ concerns, these conferences will present today’s trends and provide available answers to how the movement can prepare for the next stage of financial service evolution.
For more information about the CUNA Operations, Sales & Service Council and the CUNA Technology Council, visit www.cunacouncils.org.