The branch is not dead, it just smells funny. The majority of consumers now sees the Internet as their preferred method of banking. But while this shift has been under way for several years now, banks are severely lagging behind, as Brett King points out:
How could it be that more than 40% of customers for most banks in developed economies cite Internet Banking (and other direct channels) as their preferred method of banking, transaction volume through Internet outpaces branch by a ratio of more than 4-to-1, and yet 80% of revenue still comes through the branch?
How can it be that these same customers visit their „Internet“ bank 5-10 times per month, and the branch only 3 times a year and yet 4 out of 5 products they apply for through the bank are sold through a branch? The revenue factor is constantly cited by traditional bankers in support of the branch, but there are three reasons for this trailing revenue versus adoption rate data:
- Your „home“ branch gets allocated the revenue by the system
- The final compliance step is in-branch
- Most banks are awful at selling online
Read the full piece. Hat tip to Denkzelle.