Why credit unions can’t forget about branch banking

Even as consumers express their increased comfort with digital banking, the biggest financial institutions are doubling down on branch network investments. Most recently, Chase secured its place in the record books as the first bank to have branches in all 48 contiguous US states. Between July and August 2021, when many states were still grappling with high COVID-19 infection rates, the country’s largest bank opened consumer banking branches in nine new states.

So, why is this happening? Why are megabanks leaning into physical banking during a time when more people than ever are meeting their financial needs in the digital channel? The answer is both simple and complex. Study after study shows banked consumers prefer a blend of technology and humanity. The caveat – they want to be the ones to choose between a branch, an ATM, an app, a social network or an embedded feature. They do not want the choice to be dictated to them.

Consumer demand for choice is far from new. However, that demand is much easier to satisfy today given so many options for meeting both day-to-day and milestone financial needs. And, consumers are increasingly comfortable stitching together a fragmented set of providers to get their money jobs done. This is why earning primary financial relationships (PFR) with members is getting harder by the day. Yet, credit unions cannot afford to give up the battle for primacy.


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