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Bridging the 'transformation gap' with video teller [infographic]

Traditional and digital banking customers want different things from a branch; a VTM allows an FI to serve both in a single, cost-effective environment.

August 3, 2015 by Suzanne Cluckey — Owner, Suzanne Cluckey Communications

The average teller transaction at a bank branch costs the financial institution $4.25 — nearly three-and-a-half times the cost of an average ATM transaction, at $1.25, according to a 2013 report by Javelin Strategy and Research.

According to a study by Financial Management Solutions Inc., a provider of software and consulting services for FIs, more than two-thirds of these transactions are uncomplicated and routine:

• check deposits, 26 percent;
• cash deposits, 22 percent;
• cash withdrawals, 11 percent;
• loan payment by check, 5 percent; and
• and bulk deposits, 4 percent.

In contrast with these traditional customers who prefer teller-assisted banking, digital customers are happy do their banking online or via smartphone. As the former, mostly older, group continues to dwindle, resulting in reduced branch traffic and increasing teller transaction costs, the latter, generally younger, group steadily continues to grow.

According to a Pew Research Center survey, 61 percent of U.S. Internet users now bank online (compared with 58 percent in 2010), while 35 percent of cell phone owners bank via mobile device (compared with 18 percent in 2010).

Predictably, these numbers are higher still for adult millennials. Among those age 18 to 29, more than two-thirds (67 percent) bank online, while more than half (54 percent) bank via mobile, the Pew study found.

This is not to say that younger adults are ready to dispense with the branch, though. In its research, FMSI found that:

While millennials as a whole do not visit the branch as often as other generations, they are willing to travel to the branch for a higher quality interaction when they need to. Higher quality interactions can more likely lead to closed products sales and additional cross-selling, which is exactly the type of exchange FIs desire between account holders and branch employees.

As a way to reduce costs while bridging the divide between two very different types of users, many FIs have chosen a process of branch transformation. Typically, this involves shrinking the branch footprint significantly and moving staff out from behind the teller window and into a more sales-oriented role.

These "universal bankers" stand ready to help digital customers with their more complex financial needs — and to assist traditional customers as they adapt to a self-service environment.

In many cases, this environment includes video teller machines connected to a live remote teller. VTMs can provide the personalized, face-to-face interaction that some branch visitors prefer without the high cost associated with on-site teller services.

As shown in the infographic below, sponsored by GRGBanking, video teller devices can perform most of the functions conducted at a teller window. And in a secured lobby or drive-through setting, they can provide the added customer convenience of greatly expanded service hours.

Download a PDF of this infographic

About Suzanne Cluckey

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Suzanne’s editorial career has spanned three decades and encompassed all B2B and B2C communications formats. Her award-winning work has appeared in trade and consumer media in the United States and internationally.