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New study affirms importance of the branch

Consumers see the branch as the place where their money lives; the Web and mobile are just vehicles for its movement, a new report says.

October 29, 2015

Will digital banking replace the branch? Probably not, according to a new survey and report by financial consulting firm Protiviti.

The report, "2015 Consumer Banking and Payments Survey," argues that despite the media attention given to online and mobile banking, bank customers still seek human interaction at local branches.

The survey found that 84 percent of bank customers still visit their branches at least once a month, refuting the premise that bank branch demand is declining.

"It wasn't long ago that bankers were scratching their heads over the number of customers coming into the branch asking about online banking," Jason Goldberg, a director in the business performance improvement practice at Protiviti, said in a press release. "Our survey suggests that in the mind of the customer, the branch continues to be the place where their money lives, while the Web and mobile are applications that direct the movement of that money. Consumers clearly seek an omnichannel experience, where they move within and between channels for product purchases and account servicing and management."

Protiviti surveyed more than 2,000 U.S. consumers age 20–69 to identify perceptual and behavioral trends in banking practices, including service delivery preferences, online banking, credit card security and the adoption of new payment products. The study also breaks out results by gender and age.

Omnichannel preferences

A steady shift from multichannel (i.e., offering banking options from which customers choose one) to omnichannel (i.e., allowing customers to move fluidly across multiple options) experiences continues to be apparent as customers take advantage of multiple banking options (e.g., online, mobile, ATM, branch). The survey identified no negative correlation between the frequency of bank visits and Web and mobile banking use.

Of the individuals who expressed a channel preference, frequent branch visitors were more effusive in their praise of their brick-and-mortar locations (53 percent) than nonvisitors were about of their mobile (33 percent) experiences.

Consumer behavior and EMV shifts

The study found that younger millennials (under age 30) are using mobile applications most frequently, a finding that held up across various types of transactions from checking balances (approximately 83 percent), to sending money (approximately 46 percent).

Millennials also are more likely to a smartphone to make purchases such as merchandise, media and groceries. In-store and online purchases using smartphones decline with age, the study found.

Also on the minds of consumers and retailers is the transition to EMV. According to those surveyed, 70 percent feel that using chip security versus a magnetic stripe will be more secure, while just four percent feel it will be less secure.

The Protiviti "2015 Consumer Banking and Payments Survey" report is available for complimentary download.