By Jackie Berkoff, Project Manager, Brenna Donahue, Assistant Project Manager and Jasmin Rosen, Assistant Project Manager

In today’s digital era, the banking landscape is rapidly evolving, with traditional brick-and-mortar banks facing competition from online banks that offer convenience and efficiency to tech-savvy customers. A few MKP team members discuss their different views on whether physical branches are necessary.

1. Would you open an account at an online bank that doesn’t have branches?

Jackie: I would be completely comfortable managing my finances at an online bank. Online banks tend to offer competitive interest rates, lower fees and enhanced services like 24/7 customer support and partnerships with ATM networks for cash withdrawals. While the lack of physical branches may raise concerns for some about customer service and access to cash deposits, I think the convenience associated with online banking outweighs these drawbacks.

Jasmin: I would not feel comfortable opening an account at an online bank that doesn't have branches. I value the accessibility of in-person services, such as face-to-face customer support and the ability to visit a physical branch for complex transactions or having a branch member resolve an issue. Having a local branch provides a sense of security and convenience that I find important in managing my finances.

Brenna: I agree with Jasmin here – I feel a stronger sense of reliability, credibility and trust if I am able to develop a relationship in-person. I think there are certain financial topics that I would prefer to address in a secure face-to-face format rather than on the phone or over an online chat.

2. Can branches serve a purpose other than just depositing a check?

Jackie: I don’t think branches serve much of a purpose anymore. I’ve only gone to my bank’s branch twice in my entire life. Once when my parents took me to open checking and savings accounts when I was 15 and the other was to get a certified bank check when I was 23. The ability to open a checking or savings account online is now a standard service that most banks offer. As for the certified bank check, many online banks can provide a cashier’s check, which is very similar.

Jasmin: I believe bank branches’ physical presence establishes trust, stability and credibility. It allows the bank to establish a connection with the local community and build a trustworthy image. Bank branches’ physical presence also serves as a powerful marketing tool, promoting brand awareness and visibility.

Brenna: I think bank branches still have a purpose in society today. I appreciate the comfort of knowing that I can easily get to a nearby branch should a problem arise. In particular, I think the ability to visit a branch is valuable as it allows you to build a personal, one-on-one relationship with a banker that you can trust to provide financial advice. I also think that I would feel more comfortable being in person when I am opening accounts or applying for loans.

3. How can banks rework branches to make them more relevant?

Jackie: The only thing I think branches can offer that online banks can’t is the comfort of in-person financial advice and a sense of community. Branches should build on this benefit by offering financial literacy workshops and networking events to promote customer engagement and loyalty. By reimagining the role of branches in this way, banks can differentiate themselves from online competitors and stay relevant in today’s evolving banking landscape.

Jasmin: To make bank branches more relevant, banks should consider offering financial classes and personalized assistance. Conducting workshops in branches that cover essential topics like budgeting, investing and mortgages could resonate with coming-of-age Gen Z customers as they navigate new life phases. This approach would assist this generation through significant financial decisions, such as home purchases or retirement planning. As somebody who is considered part of Gen Z, I would have no idea where to begin with these new life phases.

Brenna: I think that the accessibility to branches is valuable, but banks could modernize their design approach. To implement a more “hybrid” approach to banking, branches should consider including digital solutions such as self-service kiosks and interactive screens to streamline routine transactions and reduce wait times. These technologies give customers the opportunity to perform basic banking tasks efficiently without requiring assistance from bank staff. Cross-training staff, designing more efficient layouts and offering a wider range of communication channels (in-person, phone, email and live chat) are additional ways banks could increase the efficiency of branches and position them as places that are valuable to their clients.

In conclusion, the debate over the necessity of physical bank branches reflects the diverse preferences and priorities of today's banking customers. While some embrace the convenience and efficiency of online banking, others value the in-person service that branches provide. However, regardless of individual preferences, it's evident that banks should adapt to the changing landscape by reimagining the role of branches.

MKP communications inc. is a New-York based marketing communications agency specializing in merger/change communications for the financial services industry.