Retail bank branches remain stubbornly relevant, despite an onslaught of digital and tech innovations.
But bank tellers’ days in those branches could be numbered.
The largest banks in the US have been investing millions in updating the capabilities and physical appearances of their thousands of ATMs — an invention that turns 50 years old this month.
As those capabilities continue to grow, customers at retail branches will spend more time interacting with machines for their day-to-day needs, while branch personnel will move from behind the counter and focus more on complex transactions, like coordinating loans for homes or small businesses.
By 2018, a new wave of ATMs — with larger, digitally enabled screens akin to tablets — will start to become the norm, offering almost all of the services human tellers now provide, as well as new capabilities like setting up cash withdrawals on your phone that you can seamlessly complete at a nearby ATM.
Already banks have outfitted ATMs with more flexible denominations — $US1, $US5, and $US10 bills instead of solely the $US20 bill — and debuted cardless transactions, wherein customers can log-in more securely just with their phone.
JPMorgan Chase, which boasts a network of more than 16,300 ATMs and 5,300 branches across the country, saw its teller transactions decline 25% between 2014 and 2016. Customers used ATMs for 90% of withdrawals and 60% of deposits, though they still exclusively cashed checks with tellers.
Teller transactions will continue to wane, as check cashing and most other services that require face-to-face contact will soon be available via ATM, said Ryan Crowley, head of branch systems and innovations for Chase. About 60% of the transactions performed by tellers can be executed via ATM today, but by 2018 it will be up to 90%.
As part of the evolution of their branches, the bank is phasing out the hulking, refrigerator-sized machines in favour of a compact design with a digital-friendly interface that’s more compatible with the website and mobile app experience. Chase now has 45 million active digital users, many of which also uses branches.
“[Customers] want it to be simple, they want it to be convenient. They want to have the same features and same consistent experience regardless of the channel they’re interacting with us in,” Crowley said.
Chase has already deployed 5,000 “eATMs,” which first debuted in 2012 and feature tablet-like screens and cardless access, in branches across the country.
The company is also testing a “micro-ATM,” which is similar to the eATM in functionality but is smaller yet. It hasn’t been released in retail branches yet.
At Bank of America, both teller and ATM transactions are declining as mobile banking spreads, though teller interactions are falling more rapidly, according to Charles Liu, who runs branch and ATM innovation for the firm and is leading an overhaul of its entire retail presence.
Bank of America, which has a network of 4,600 branches and 15,900 ATMs, is starting to deploy a new-wave ATM of its own that it’s calling an “XTM,” or “Extreme ATM.”
What makes it extreme? Besides the teller-killing advancements on the software side, the most distinguishing feature is a 32-inch, portrait-style monitor — nearly double the size of traditional ATM screens — that, like Chase’s, will mimic a tablet-like digital experience.
How much an extremely large monitor will benefit the customer is unclear. Only the bottom third of the screen will hold users’ personal information, for security purposes. The rest will display advertisements, targeted offers (travel credit cards, for instance), video tutorials (so people can learn how to deposit their checks with the mobile app), and a live video feed in a box in the corner showing what’s going on directly behind you (also for security purposes).
Bank of America will have 100 of its “XTMs” up and running this year, with 1,000 more set to roll out over the next couple years, according to Liu.
Another new feature that both companies are working on is letting customers “pre-stage” ATM transactions. This would enable customers to start a cash withdrawal from their smartphone and then head to any of the bank’s ATMs over the next 24 hours to collect the cash.
Bank of America has been testing the feature out on employees and plans to roll out it to the public in August. Chase said it was still testing the feature and hasn’t announced a release date yet.
The bank branch isn’t going anywhere just yet. But your friendly neighbourhood teller might be replaced by sleek, digitally connected ATM in the not-too-distant future.
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