# How has the pandemic shifted the perception of the local bank branch? Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2020-11-09 Category: BANKING Category URL: https://financedigest.com/category/banking Meta Title: The Future of Banking Branches: Digital vs. Human Interaction Meta Description: Discover why the local branch is still a critical node in the banking network and how the pandemic has reshaped customer preferences for in-person banking URL: https://financedigest.com/how-has-the-pandemic-shifted-the-perception-of-the-local-bank-branchhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/untitled-design-2020-11-09t105330-1736838738393-compressed.jpg) _By **Brian Holden,** Director, Financial Services at_ [_SAS UK & Ireland_](https://www.sas.com/en_gb/home.html) The idea that branch banking is on its way out is nothing new. In fact, banks have been working to supplement traditional customer service channels with digital equivalents for years now – spurred on by the idea that younger generations prefer to do most things online. The pandemic has brought the focus on digital banking to the forefront, with [TSB](https://www.bbc.co.uk/news/business-54343392) announcing the closure of a third of its branches last month. Our [research](https://www.sas.com/sas/whitepapers/has-covid-19-created-a-new-kind-of-customer.html) made it clear that Covid-19 has brought in irreversible changes to the way we act, even among those previously considered less tech-savvy – 10% of respondents began using digital apps and services for the first time during lockdown, of which three-fifths (58%) plan to continue using them permanently Put simply, a visit to the local branch has become synonymous with paper-based processes which are often slow and inefficient. But that is not to say the [end is here for high street](https://www.financedigest.com/wall-street-ends-lower-as-bond-yields-jump-on-growth-concerns.html "Wall Street ends lower as bond yields jump on growth concerns") branches – instead, the pandemic has caused banks to reassess their value. [**Banking as a people business**](https://www.financedigest.com/world-bank-scrapping-ease-of-doing-business-index-is-a-reminder-to-focus-on-fundamentals.html "World Bank scrapping Ease of Doing Business Index is a reminder to focus on fundamentals") Over the past few months, COVID-19 has confronted many people with a prospect of financial distress that they could never have imagined at the start of this [year](https://www.financedigest.com/is-2022-the-year-green-finance-incorporates-climate-risk.html "Is 2022 the year green finance incorporates climate risk?"). And despite all the investment in call centres, online [banking websites and mobile apps](https://www.financedigest.com/why-you-should-use-a-mobile-banking-app-and-how-to-make-the-most-of-it.html "Why You Should Use a Mobile Banking App – and How to Make the Most of It"), the digital infrastructure that banks have built over the past decade hasn’t been the panacea that everyone expected. [Banks are realising that customers _don’t_ want](https://www.financedigest.com/lost-in-translation-why-banks-must-learn-the-language-of-their-customers.html "Lost in Translation: Why Banks Must Learn the Language of their Customers") to do everything online after all. When their livelihoods and businesses are threatened, they [don’t want to wait on hold with the call centre—they go to their local branch because they know](https://www.financedigest.com/women-in-technology-that-you-should-know-but-probably-dont.html "Women In Technology That You Should Know (But Probably Don’t)") they’ll get an answer. And when they’re [really worried about money](https://www.financedigest.com/who-really-controls-your-money.html "Who Really Controls Your Money?"), they want personal advice and face-to-face support from a real human, not just a set of recommendations on a website. As a result, the crisis has shown the branch in a completely different light: it’s not on the periphery, but at the [heart of the banking community](https://www.financedigest.com/putting-collaboration-and-community-at-the-heart-of-the-metaverse.html "Putting collaboration and community at the heart of the metaverse"). That’s not to say that [digital banking](https://www.financedigest.com/key-considerations-for-building-an-inclusive-digital-banking-experience-fit-for-the-future.html "Key considerations for building an inclusive Digital Banking Experience fit for the Future") has failed, or that digital investments have been wasted—it’s just that the crisis has highlighted something that should have been obvious all along. Banking isn’t just about [processing](https://www.financedigest.com/gary-mcgaghey-explains-how-cfos-can-strengthen-decision-making-processes-and-reimagine-the-finance-model.html "Gary McGaghey Explains How CFOs Can Strengthen Decision-Making Processes and Reimagine the Finance Model") financial transactions; it’s about helping people live the lives they want to live. It’s about making banking simple, safe and rewarding. Nothing is more personal or more emotive than a [small business](https://www.financedigest.com/foolproof-local-marketing-strategies-for-small-businesses.html "Foolproof Local Marketing Strategies for Small Businesses") owner’s dreams or a family’s financial security. We live in a network society, that’s true—but the network is fundamentally built on human relationships, not technology. [Bank branches are critical nodes in that network](https://www.financedigest.com/could-the-npa-be-the-catalyst-banks-need-to-transform-their-payment-networks.html "Could the NPA be the catalyst banks need to transform their payment networks?"). You can’t [extract those nodes and expect everything to function](https://www.financedigest.com/functional-extracts-market-potential-growth-share-demand-and-analysis-of-key-players-forecasts-to-2029.html "Functional Extracts Market Potential Growth, Share, Demand and Analysis of Key Players – Forecasts to 2029") in the same way. So instead of trying to invent some new means of personal banking interaction online, why not use the ecosystems and talent we already have, and give the branch its due as a trusted [focal point](https://www.financedigest.com/partnerships-to-be-the-focal-point-of-enteral-nutrition-market.html "Partnerships to be the focal point of Enteral Nutrition Market") for the local community? **A new future for the local branch** At the same time, those city skyscrapers no longer seem to be gleaming quite so brightly. Although security and regulatory compliance considerations have historically made many banks resistant to the idea of allowing employees to [work from home](https://www.financedigest.com/working-from-home-heres-how-you-can-save-money-on-your-auto-insurance.html "Working From Home? Here’s How You Can Save Money on Your Auto Insurance"), the pandemic is forcing them to push those boundaries. With the ongoing risk of contagion, people are no longer willing to spend several hours a day packed like sardines into a tube carriage just to get to the office—and this is a situation that may continue indefinitely. Under these circumstances, the branch begins to look like an attractive option not only for traditional branch-based functions, but as a decentralised workplace. By providing a secure location where employees can [access bank](https://www.financedigest.com/the-open-banking-revolution-enabling-accessible-and-inclusive-finance.html "The open banking revolution – enabling accessible and inclusive finance") systems, it eliminates the compliance concerns of working from home, while ensuring that staff aren’t obliged to commute into central offices unless they really need to. Moreover, with the [cost of a desk in Canary Wharf estimated at around £100,000 per year, there could be significant cost savings](https://www.financedigest.com/how-to-save-money-as-a-student-during-the-cost-of-living-crisis.html "How to Save Money as a Student During the Cost of Living Crisis") from moving to a more branch-based model. This isn’t just blue-sky thinking—it’s something that [major banks](https://www.financedigest.com/banks-deploy-ai-3-major-technological-advances.html "Banks Deploy AI – 3 Major Technological Advances            ") are already actively exploring. Jes Staley, Group Chief Executive of Barclays, has gone on the record about rethinking the balance between central and local, potentially enabling [investment banking](https://www.financedigest.com/investment-banks-trading-revenue-likely-to-shrink-barclays-boss-says.html "Investment banks’ trading revenue likely to shrink, Barclays boss says") and call centre teams to work from retail branches. With around 70,000 Barclays staff currently working from home due to lockdown, he told the [BBC](https://www.bbc.co.uk/news/business-52467965): “There will be a long-term adjustment to our location strategy. The notion of [putting 7,000 people in a building may be a thing](https://www.financedigest.com/techie-turn-offs-top-7-things-that-put-talent-off-applying-for-tech-roles.html "Techie turn-offs: Top 7 things that put talent off applying for tech roles") of the past.” **Striking a balance with automation** However, if we do [see a shift towards](https://www.financedigest.com/britains-kingfisher-sees-annual-profit-towards-higher-end-of-forecasts.html "Britain’s Kingfisher sees annual profit towards higher end of forecasts") more of a hub-and-spoke model, with more responsibility shifting from central office to the branch network, branches can’t stay locked in the past. The in-branch experience needs to be just as simple, fast and seamless as the web or mobile experience should be. Customers won’t tolerate queues, paperwork and manual processes, and they’ll [expect consistent service regardless of how they choose to interact with their bank](https://www.financedigest.com/factbox-big-banks-expected-to-rack-up-more-than-1-billion-in-fines-for-whatsapp-use.html "Factbox-Big banks expected to rack up more than billion in fines for WhatsApp use"). Offering the right advice and [support to each customer](https://www.financedigest.com/why-now-is-the-time-for-banks-to-use-their-data-to-support-customers.html "Why now is the time for banks to use their data to support customers") across all channels is a challenge that can only be solved with the right combination of people, processes and technology. Essentially, you need to find a way to make the right information available to make the right decisions at the right time and embed those decision support mechanisms into all your customer-facing [business processes](https://www.financedigest.com/what-businesses-can-achieve-with-microsofts-full-suite-of-process-automation-tools.html "What businesses can achieve with Microsoft’s full suite of process automation tools"). **Clear [value in intelligent](https://www.financedigest.com/how-to-unlock-greater-value-from-artificial-intelligence.html "How to unlock greater value from artificial intelligence") decision-making** Data-driven technologies enabled by [artificial intelligence](https://www.sas.com/en_gb/insights/analytics/what-is-artificial-intelligence.html) equip banks with the tools required to help support their personnel support their customers better through the current turmoil. By implementing solutions to enable [intelligent decision-making](https://www.sas.com/en_gb/software/sas-intelligent-decisioning.html), banks are empowered to fine-grain their approach to customer support through real-time insights at an individual level, no matter where their client engages. Under current circumstances, it is essential for banks to bring the personal [touch of banking to complex cases where human expertise is required](https://www.financedigest.com/building-a-relationship-led-bank-requires-a-more-human-touch.html "Building a relationship led bank requires a more human touch"). Here, the local branch will likely [remain a critical bridge between banks](https://www.financedigest.com/bank-of-england-consults-on-remaining-basel-bank-capital-rules.html "Bank of England consults on remaining Basel bank capital rules") and their customers, helping them navigate their way through the crisis. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---