Changing customer behaviours, online and mobile migration, fintech and digital disruption, legacy systems, outdated, the death of the high street.  Phrases often used to explain why the bank branch will soon be consigned to the history books.  The reality underpinning the prediction is not so clear though. There have been unprecedented numbers of branch closures.  But many banks, and perhaps most importantly their customers, still have confidence in the need for a bricks and mortar presence.  So, let’s step into the branch of the future to see what’s ahead.

Customers still want the human touch

McKinsey & Company research found that the human touch is still important to bank customers in most markets.  Take the UK for example.  The study showed that just 13% of customers prefer doing everything remotely.  31% prefer branches or ATMS for all their needs because trust is low in banks and financial systems.  19% simply prefer using branches or ATMs for all their needs for a variety of other reasons.  This group includes low-tech seniors.  The rest prefer a mix of digital banking and face-to-face interactions.  McKinsey discovered the trend carried across most markets.

Research by Samsung also showed that the human touch is important.  Its study found that customers are happy using digital for quick transactions.  However, 77% of customers prefer face-to-face interactions with their bank for more substantive conversations.  Customers tend to want the best of both worlds – a hybrid digital / physical experience to manage their money and plan their financial future.  In an omnichannel world, the branch is still an important service and sales channel.

And the quality of the branch experience matters

The quality of the branch experience can make or break a relationship. While customers prefer their branch for more involved transactions and conversations, a poor experience can put them off.  Or make them switch providers.  The Samsung study found that the biggest complaint was unprepared bank staff at 68%, followed by long wait times at 56% and impersonal service at 49%.  The branch of the future needs to fix these problems.  The customer experience bar is being set by the best experience on offer.  Inside and outside the sector.  Gold standards come from brands big and small – from Amazon or a neighbourhood store.  Shep Hyken believes that convenience is one of the biggest trends in customer experience.  Time has become a precious commodity and customers rave about brands that simply make life easy for them.

Re-imagining the branch experience

The most innovative banks are optimising and redesigning their branch network to make the customer experience easy, fast, relevant and personalised.  These banks have a laser focus on offering customers an exceptional level of service.  Value-add technology is the enabler.  They are rethinking format, purpose and location.  Best-in-class brands recognise that branch innovation is the crossroads where the physical is fused with digital to create a seamless, differentiated experience.  Banks across the globe are experimenting and re-imagining the branch experience.  A quick look at how they are doing things gives us a good idea of what’s to come.

Bank associates are playing a more strategic role in the customer journey as the branch model shifts

As the automation of routine and low-value tasks increases, the role of bank staff is becoming more advisory.  The focus is on higher value financial services, products, and more complex interactions.  Bank associates are increasingly playing a more strategic role in the customer journey as the branch model shifts.  And employees need to better prepared, more flexible and multi-skilled to deliver the service and experience customers are looking for.  Personalised service, enabled by technology, is top of the customer wish list, according to the Samsung research.  For example, 62% of customers would like greeters prepared for their arrival with personalised information.  Customer experience leaders are training bank teams to use technology and proprietary data to make service more informed and relevant.

AIB branch

AIB is a great example of a bank placing staff at the forefront of their branch transformation.  Redesigned branches introduce soft informal seating areas for customer discussions.  Tablets enable staff to hold informed consultative meetings, whilst sharing a screen with the customer.  If a more detailed discussion is needed with a specialist, customers can be introduced to an advisor via video conference, ensuring that the relevant specialist is available at all times.  Customers also expect accessibility at a time convenient to them so an increasing number of branches are open for extended hours – seven days a week.  This ensures that online convenience is replicated in face-to-face engagement in branches.

The hybrid customer service team

Pop into HSBC‘s flagship New York branch and you might meet Pepper, its humanoid robot banking assistant.  The assistant is powered by SoftBank Robotics.  Pepper complements the branch team and helps customers with basic questions, product tutorials and information.  Staff answer more complex queries.  The Manhattan branch currently has around 100 to 200 visitors per day.  Pepper’s presence is expected to increase traffic by 20%.  Only time will tell if Pepper, which will be joined by a second robot, proves to be a sustainable draw for customers.

NatWest has been testing Cora, its ‘digital human’ banking assistant.  If the pilot is successful, the assistant could be used in branches to answer basic customer enquiries.  Customers will also be able to use Cora at home on PCs and laptops, and eventually on mobiles.  The assistant is intended to complement branch, telephone and online services, not replace them.  The bank has said that early testing shows customers who don’t use digital services may be more motivated to interact with a ‘digital human’ like Cora.

Virtual centres and digital booths

Some branches are being designed as digital booths or hubs.  Bank of America is building on its people-less branch concept by rolling out small virtual centres, equipped with an ATM and video conferencing room for customers to talk to specialists in remote locations.  An on-site digital ambassador helps to ease customers into the new concept.  The centres are around a quarter of the size of a traditional outlet.  To attract more digital-first customers, the bank is also leading with digital to test new markets before it opens a physical branch.  Using digital channels, customers open accounts, apply for loans, mortgages and credit cards before a local branch opens its doors.

The digital branch within a branch

OCBC Bank is rolling out its new ‘digital service kiosk’ concept.  The Singaporean bank’s Customer Experience and E-business teams analysed branch transactions over two years while designing the kiosks.  The machines work like ‘mini branches’ and customers can use them for 15 of the most common over-the-counter services.  In May, trials in eight branches showed 10% of transactions that would have been made over the counter were made via the machines. The bank plans to roll out the machines to 35 of its branches by 2020 (currently it has 51 branches).  OCBC will upskill all of its bank tellers over the next five years to work as digital ambass