Will the branch of the future be in your living room?
To deal with the slowdown in foot traffic, some banks and credit unions have been adding video capabilities at their branches. It is a way to reduce staffing needs at individual branches, while giving customers face time with people who can help them.
But there is a persistent question about such offerings: Why can’t customers just video-chat with their bank on their phones?
Gene Pranger, CEO of BankOn Mobile Video, wants to make that a reality. BankOn received a patent in June for technology that allows a financial institution to control multiple screens of content on consumers’ mobile devices. For instance, in one pane is the video feed of the bank rep, with real-time collaboration — filling out forms, capturing images of documents and signing documents — on the other.
“It allows the customer to see two different things on same screen simultaneously,” Pranger said. “This offers members an in-person experience through face-to-face interaction via any digital channel — removing the need for either party to be in an office or branch.”
Pranger is somewhat of a video banking pioneer. At his previous company, uGenius, he helped create the ATM video technology that NCR Corp uses in its interactive teller machines. Pranger sold uGenius to NCR in 2012.
Pranger said 10 financial institutions in the U.S. have signed agreements to use the technology, including two credit unions going live with it in the next few weeks. He declined to name the institutions.
Observers say mobile video is a good compromise of the high-touch nature of branch banking and the always-on way of digital banking.
“It’s very interesting from a sales perspective; customers can have access to an adviser when they’re not in a branch,” said Emmett Higdon, director of mobile at Javelin Strategy & Research. “It’s a great opportunity to service those complex needs.”
But some say while the promise of mobile video banking interactions is great, some kinks still need to be worked out. Digital financial services companies often tout the fact their technology allows you to do banking in your underwear — perhaps most notably crystallized in Lending Tree’s “Boxers” ad campaign — but a banker may not be interested in chatting with customers sitting on their couch in their underwear, said Charles Liu, Bank of America's chief of branch transformation, ATM innovation and market strategy.
“One concern we have to address is an employee’s sense of comfort,” he said. Still, there could be measures installed to avoid such an awkward encounter — think of how live call-in radio programs have a seven-second delay to prevent expletives from being said on the air.
A bigger concern, Liu said, is that the customer experience may not be as smooth for those who have a lower internet speeds. If the feed is choppy, the customer will associate the negative user interface with the bank even if it is really the fault of their own connection.
“As a banker I can’t control the network you are using, if you are on a lesser bandwidth than us, the experience may not be great and we don’t want that,” he said.
Customers’ devices also have to be compatible with such capabilities. Pranger said his firm worked to make sure its software wouldn’t only be available to customers with the latest mobile technology. The technology works with more than a dozen different phones released in the last three years. (Those still using turn-of-the-millennium flip phones are out of luck.)
Liu also said privacy concerns have to be addressed, for example if a customer is discussing investments with a banker while at a coffee shop. “What if someone overhears that?”
Still, Liu said, the appeal of mobile video in banking is undeniable, and Bank of America is working on how to do it right.
“We personally think customers will like the convenience of conversing with a banker at home,” he said. “We’re looking at a few different options and testing some proof-of-concepts on how to do this in a safe environment.”
Ultimately, Liu said, customers want a mixture of options — mobile video, branches where customers can meet with bankers in person and by video and virtual assistants, such as its upcoming erica, when interacting with their bank.
Other banks are experimenting in this area, too. Wells Fargo, for instance, is piloting video chat in its contact centers for consumers interested in home equity loans. The wealth and investment management division is already using screen sharing to interact with clients, a bank spokeswoman said.
Javelin’s Higdon agreed that video will become a bigger part of banking, both on mobile devices and overall.
“You’re already seeing banks use it in branches, and at ITMs,” he said, referring to interactive ATMs. “It’s about maximizing every customer touchpoint.”
While not all consumers may readily want to grant their financial institution that type of access to their phones, Pranger said he believes most people are used to sharing information in the digital world, and would be drawn to the convenience of engaging in an interactive video session with a banker or MSR from their own home. He said banks and CUs will find it attractive because it will greatly expand their sales and marketing capability.
“When a consumer has a financial need, they have limited opportunities to make contact with a banker because of limited branch hours and locations,” he said. “Banks can now have the opportunity to make a connection with a consumer who is looking for a financial product or advice at any time.”