How Smart Is Your Branch?

November 10, 2014 at 8:28 am Leave a comment

Any vendor that can make itself relevant to the financial services industry since 1859 is worth paying attention to because it clearly knows how to change with the times.  That’s why this post from the Motley Fool about Diebold caught my attention.  At a recent electronics conference in Sin City, Diebold unveiled its vision of the branch of the future.

Diebold envisions what it describes as a “responsive banking concept” in which tellers are eliminated and branches become smaller but much more high tech.  You can go into the branch for simple ATM transactions, or if you want to make more sophisticated transactions using virtual tellers, you can do that, as well.  Let’s say your member is interested getting a home or car loan.  Another virtual touch board would allow the member to easily communicate with a live person via two-way video.

Similarly, IBM recently announced that it was partnering with the Bank of China to create a flagship technology branch.  This branch will not be entirely virtual since members will have the ability to call over bank representatives when they need them, but the basic idea is the same:  members will use cell phones or codes to execute transactions with minimal involvement from tellers.

What intrigues me so much about these prototype branches is what they portend about the future of banking.  Even if you are an advocate of the brick-and-mortar branch, you have to recognize that the branch itself is going to become more virtual.  Tomorrow’s member is going to expect a seamless transition between the banking she conducts on her cell phone and that she carries out in her branch.

In addition, the virtual branch will make Big Data analytics an essential tool for all financial institutions. For instance, the branch being constructed by IBM allows bank executives to get real time information about what consumers are interested in.  Consumers can even be encouraged to go to less crowded branches that may be near by.  In other words, going digital will provide your marketing department with more information about your members’ needs and desires than you could ever have anticipated. The institutions that are best equipped to analyze this information and translate it into financial products and services will be the ones most prepared to prosper going forward.

Comptroller Urges Retailers to Take Responsibility for Data Breaches

The need for retailers to take on more of the burden for preventing data breaches got a high level endorsement on Friday. Speaking before an audience of community bankers, Comptroller of the Currency Thomas J. Curry pointed out that data breaches impose a particularly heavy burden on smaller financial institutions, responsible for reissuing compromised debit and credit cards. Data breaches also “demonstrate why we need to level the playing field between financial institutions and merchants. The same expectations for security of customer information and customer notification when breaches occur should apply to all institutions. And when breaches occur in merchant systems, it seems only fair to me that they should be responsible for some of the expenses that result.”

Well said.  On that note, have a great day.

Entry filed under: Advocacy, General. Tags: , , .

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Authored By:

Henry Meier, Esq., General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association.

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