RICHLAND,Wash. — Gesa CU's move to virtual teller branches have reduced staff turnover, sped up transaction times, reduced the cost of branch expansion and even scored the CU the 2013 Excellence in Technology award at this year's CUNA Technology Council Conference, all while preserving the personal touch in a digital world.
"There were several reasons that led us down this path," said Gesa CU's Chief Information Officer, Raj Bandaru. "The traditional branch designs were expensive to build and maintain. We wanted to leverage technology that still had the human element, operational efficiencies and a focus on sales and not transactions."
As the first financial institution in the Pacific Northwest to use personal teller machines (PTMs), the $1.3 billion credit union, with 114,000 members and 12 physical branches, stood out as an industry innovator. By using APTRA Interactive Teller software, complete with 42-inch touchscreens, Gesa CU employees can now remotely connect with members via a live, two-way video/audio conversation over a state-of-the-art ATM.
Bandaru explained that remote tellers can virtually control more than 95% of typical branch transactions. And transactions times are approximately 33% faster than for an average teller interaction. Members can schedule appointments with industry specialists, make deposits and withdrawals as well as receive product and rate information.
"The video tellers are situated in a more comfortable and secure setting at the corporate headquarters as opposed to standing in a branch and in the hot seat during a burglary," said Bandaru. "The overall teller turnover is reduced in the new model with better employee satisfaction scores."
As is the case with all major technological undertakings, due diligence is required. For Gesa CU, this included a six-month "discovery" period, explained Bandaru. "The solution was rolled out earlier in this year after an intensive pilot process. The solution was extensively tested in-house with processes and procedures adopted before being implemented in the field."
With six PTMs in two branches, Gesa CU plans to expand its virtual footprint in 2014. This is for good reason, explained Bandaru. The initial virtual branch setup costs are one-sixth of a traditional branch and the time-to-market is approximately three months versus six months.
"We are seeing a significant demographic shift towards online banking and mobile banking usage. This trend is rapidly changing with demand for a more seamless multi-channel experience," noted Bandaru. "As we keep adding newer channels, we continue to maintain the legacy channels for the traditionalists."
From a technology perspective, the hardware is comprised of a basic windows platform with uGenius software that drives the audio/video teller interactions. The platform is considered "standard stack" with provisions for additional network bandwidth for the audio/video and data traffic. "The Gesa implementation also includes an interface to the banking core system, which simplifies transactions and speeds up the member and teller interaction time," said Bandaru.
While member training was considered streamlined, with many members feeling confident after first use, employees had a steeper learning curve. The back office, for example, had to learn new protocols related to complex operating systems, such as Check 21 processing, cash loading, accounting and balancing, IT support, paper jams and overall machine maintenance.
"The first few weeks were intimidating, but over time things got easier," said Bandaru. "The marketing department rolled out the real-time touch screen information kiosks at the same time and that eliminated a major expense with paper and printing."
There were, of course, some obvious security concerns, the credit union conceded, but these were quickly overcome as digital branch devices are connected to Gesa CU's internal network security controls and encryption. "We manage these devices just like we would with any of the computers in the environment," said Bandaru. "We follow the same level of rigor with risk identification and mitigation. The cash handling is a lot more secure and video tellers are at a safe remote location."
Bandaru is quick to point out that CUs should take a careful internal look with a long view before entering into this arena. "Credit unions will need to figure out a way to provide the same personalized member service at a lower price point with technology. Everyone will need to find that happy middle ground to stay relevant in a highly competitive landscape, and we would be happy to assist any credit union in this area."