On their way out are the velvet ropes that direct bank customers to tellers who can handle their deposit or cash a check. Same goes for the magazine-strewn waiting area populated by folks waiting to talk to a bank-branch officer about a loan. And the pneumatic tube that drive-through customers have used for decades to conduct transactions? It's probably on its way out, too.
March 13, 2014
On their way out are the velvet ropes that direct bank customers to tellers who can handle their deposit or cash a check.
Same goes for the magazine-strewn waiting area populated by folks waiting to talk to a bank-branch officer about a loan.
And the pneumatic tube that drive-through customers have used for decades to conduct transactions? It's probably on its way out, too.
The branch office of the future is in the works today. It figures to be different from the ones that customers are used to - smaller and more tech-focused - but still offering neighborhood locations and the human touch.
"We're just stepping up where our customers are expecting us to be in creating new ways for our customers to bank," said Brad Nolan, a senior vice president for JPMorgan Chase & Co., who runs its innovation and design center in Columbus.
The center, tucked into a building just south of Chase's massive McCoy Center at Polaris, is used to test ideas such as the super-charged ATM device that Chase has deployed into 400 branch offices, including several in the Columbus area. About 1,000 of the devices have been sent into branches so far.
Huntington Bancshares is doing similar work at one of its offices Downtown.
Michael Bassani, senior vice president and director of strategic distribution for Huntington, calls it "kind of a test kitchen."
"As we develop these new techniques, we can deploy them. ... We can role-play and re-engineer our processes and procedures so that we know exactly what kind of impact it will have."
The drive for change at branches reflects some of the same issues that bricks-and-mortar stores face. Both are losing foot traffic as customers increasingly turn online to transact business.
Both also want to give customers more flexibility to do more banking on their own, even in retail locations, just as grocery stores have let customers ring up their own purchases or airlines allow passengers to print their boarding pass at home.
"Banks are clearly moving," said Bob Meara, a senior analyst with Celent, a research company for financial institutions. "There is no single blueprint or magic bullet of what these new branch designs will look like."
The branch of the future will be staffed by what are called "universal bankers" who can provide traditional teller services, such as cashing checks, and also can arrange mortgages, auto loans and the like, Meara said.
Technology also will play an increasing role. At the test sites used by Chase and Huntington, teller lines will be replaced by pods or self-service kiosks equipped with the powerful ATMs that will be able to do much of the work that a teller does now, including counting huge wads of cash or thick stacks of checks.
To make the best use of the strengths of the human and tech offerings, bank employees will greet customers when they walk in and guide them to the appropriate machine or staff member.
Bassani said 80 to 90 percent of transactions now handled by tellers lend themselves to the kind of self-service work that the powerful ATM can do.
Beyond the kiosks, Chase has set up what it calls access bars, which are like standup banker stations where the universal banker can, for example, print a statement or change the address on an account.
And the traditional waiting area hasn't disappeared. Chase's lets customers relax with a tablet while waiting for a banker who can help them open an account or conduct other more-complex transactions.
The site also includes a traditional-looking teller area that the branch office could use on busy days.
Chase has another area at its test site where it is experimenting with ideas such as using biometrics, which would let a customer use a fingerprint, a palm print or an eye scan at an ATM, or smartphones, which customers could use to start a transaction such as an ATM withdrawal before completing it by showing a transaction code on the phone to the ATM.
Chase also is testing ideas for the drive-through that emphasize the use of a video screen, allowing customers to handle their transactions mostly on their own but with the ability to talk with a bank employee stationed a few feet - or many miles - away.
Also being tested: a standalone ATM that could be moved up or down to adjust to the height of a customer's vehicle.
"It's a bit of a playground," Nolan said of the area. "There are things that will never see the light of day."
Bassani and Nolan said that although there are costs to deploying the new systems, over time, the research will help the banks make more-efficient use of employees and equipment.
"By creating automation, you create efficiency in the branch," Nolan said. "If we can eliminate our own people stacking, sorting and counting cash and leave it to devices, people can put their attention on our customers and advising them."
While Huntington, Chase and other large banks are working toward making big changes at their branch offices, smaller banks are expected to be slower to embrace these kinds of changes, Meara said.
"In branches, self-service is controversial," he said. "Large banks are receptive. Many community banks reflect a more stubborn attitude: 'Self-service is fine, but if it's one of my important customers, I'll be damned if I'm going to service them with a machine.'"