by Daniel Granderson
October 19, 2016
True or false?
Consumer financial services are being reshaped at a dizzying pace by technological change.
Traditional consumer banking channels and methods are simply no longer relevant.
False, by a mile, in fact.
Point 1. While the traditional banking account may be losing ground, it remains the cornerstone of traditional consumer financial services.
As of 2016, roughly half (49.4%) of adults have a checking account, which underscores the continuing importance of this foundational banking tool to consumers. However, checking account usage trends suggest that this foundation has begun to erode and will likely continue to do so: the percentage of adults with a checking account has fallen 7.7% during 2007-2016.
But the primary checking account remains the foundation of consumer banking.
Point 2. To consumers, the bank branch matters—even among Millennials.
For them, banking is a lot like real estate: it’s about location, location, location: While multi-channel banking continues to grow in importance, the branch remains a dominant factor in choosing one’s primary bank: almost 6 in 10 consumers who have a primary bank cite branch location as a reason for choosing that bank, almost twice the percentage citing runner-up rates/fees (31%).
In taste of generational change, more technology-forward Millennials nevertheless value branch location when choosing a bank—just less prevalently: Some 43% of 18-24s and 51% of 25-34s cite branch location as a reason for choosing that bank, versus at least 65% of those age 65+. Financial institutions that complement the value of branch banking with a growing list of mobile-forward banking features and benefits can serve more than one demographic at once—and serve each demographic at once.
-- By David Morris
Provide the following details to subscribe.