A growing number of banks are deploying "personal teller" machines equipped with videoconferencing that allow remote branch staff to do virtually anything they could at the physical location.

Coastal Federal Credit Union in North Carolina was one of the first financial institutions to experiment with this. It has been using video kiosks from uGenius for two years to let customers interact with remote, video-based tellers.

Mid-Hudson Valley Credit Union in Kingston, N.Y. has opened a "nonteller" branch filled with uGenius video kiosks, one of several moves the credit union has made as part of a bold embrace of video as a means to provide customer service.

"You touch the screen, and you're talking to a human being," says Bob Michau, a marketing manager for the credit union. The 11-branch Mid-Hudson Valley has deployed 24 video teller units. The machines, pictured at right, can be used to scan checks, count cash and dispense cash, "anything a 'normal' teller can do," Michau says, adding that usage has come from all demographics, as opposed to being more heavily used by younger members.

The credit union is also pilot testing a drive-through video teller service using video teller terminals combined with automated teller machine technology provided in partnership with NCR, making it one of the first financial institutions in the U.S. to deploy the technology.

In June, Citizens Financial Group launched a video pilot in four states in which customers in participating Citizens Bank and Charter One branches tested the face-to-face interactions with specialists in different locations.

Driven by Cisco's Remote Expert — a telepresence and collaboration product featuring high definition video — and Syngraffi's LongPen's remote electronic signature solution, the Citizens initiative will enable a range of mortgage and wealth management services through video conversations, scheduled appointments and access to customer service. The pilot is underway in Illinois, Massachusetts, Philadelphia and Long Island.

Video can also prove beneficial in cutting branch overhead, a crucial challenge for banks as brick-and-mortar retail becomes more expensive in coming years. Rabobank in the Netherlands, for example, is using virtual service terminals to reach rural areas of the Netherlands, where the foot traffic is much lower than in other parts of the country. "The branches are open only a few hours a day, but beyond those hours they have a terminal in which you can connect with an advisor via a video," says Alex Hesse of Forrester. "It's an interesting model that makes service much more efficient."