News

Improving the customer experience

April 5, 2006

This article appeared in the ATM & Financial Self-Service Executive Summary, Spring 2006.

The old banking model is changing. Beyond the demand for faster, more consistent and quality services, bank customers and credit union members want better technology and advanced functions. And they won't hesitate to take their business elsewhere if their ever-growing expectations aren't met.

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On the other side of the banking coin is the need for financial institutions to grow organically. Continuing to work within the confines of a limited pool of already-banked consumers isn't realistic, at least not anymore.

Dave Grano, chief executive of Portland, Ore.-based financial services solutions provider Vero Inc., said the days of acquisition growth are over.

"Our bank partners are telling us that as customer acquisition slows down, they will need to increase their focus on organic growth via incremental customer segments such as unbanked consumers," he said. "Additionally, they need to physically expand their presence without increasing their costs. Their biggest installed cost comes from operating the branch, so they have to find a balance."

A balancing act

Finding a balance is challenging. "Commercial accounts are a major focus for most banks," Grano said. "The requirement to cash checks for unbanked employees of commercial accounts is critical to growing and maintaining commercial account relationships."

But in high-volume branches, servicing commercial accounts and underbanked consumers can hinder service to regular customers.

"Studies show that there is an average 13-minute increased wait time during peak banking hours," Grano said. "And banks want to avoid making existing and potential customers wait in long lines."

In addition to long teller lines, FIs take a $6 to $10 hit per check-cashing transaction for non-customers, according to the American Bankers Association.

The solution: Automated check-cashing.

Automating the process

Palm Desert National Bank, a three-branch California FI with $30.4 million in annual sales, is taking the automated approach. After launching a pilot with Vero last year, the bank now operates a self-service check-cashing kiosk at one of its branches.

Vero's end-to-end solution provides banks a means to meet Customer Identification Program requirements, along with unique tools to prevent fraud. For Sandra Hartfield, president of PDNB's Electronic Banking division, the automated solution has helped PDNB automate the check-cashing process for employees of regional landscaping companies, which comprise a healthy portion of PDNB's commercial accounts.

"We wanted to know how our landscapers would feel about going to a kiosk to cash their checks," she said. "That's when we piloted the program, and it's been a huge success. It's convenient for their employees, and it works for us."

Hartfield said PDNB expects to place similar kiosks in its other branches.

"If you deal with consumers in the bank - regular accountholders - this kind of solution could benefit you," she said. "It allows you to serve their (commercial account) employees as well as the underbanked without having them go through the teller line."