CHICAGO – The future of the branch office continues to be a matter of divided debate, as was made clear during a Colloquium here sponsored by the Filene Research Institute.
CU professionals, financial industry observers, Filene researchers and others offered varying views on where the branch fits in the financial services delivery model – and whether it will continue to. Dennis Campbell, a Filene Fellow and Harvard Business School graduate, observed that despite an abundance of lower cost channel alternatives, the branch model is not going anywhere, even though institutions have been investing in alternate delivery channels since the mid-1970s. Costs are down per customer, he said, but not overall.
Campbell cited one study showing consumers who use online banking are 35% more profitable than those who don’t, yet those same consumers’ profitability drops by 16% once they become active online users because they manage accounts more closely and are better at avoiding fees.
The Future of Branching discussion, held at the headquarters of consulting firm Accenture, included a session linked to participants with Accenture’s partners in the south of France via video-conferencing for a virtual tour of the future of branching. One person offering a differing perspective on branches was Willard Ross, SVP and chief retail officer at Coastal FCU in Raleigh, N.C., who explained how his credit union now offers 12 hours of service, seven days per week with personal teller machines. It has reduced teller cost by 40% while doubling hours and is on track to double its daily sales per full-time employee.
