What does the future hold for bank branches?

We’re proud to offer branches in both Salt Lake City and Lehi, Utah. We offer comprehensive business banking services at all our locations. And yet, at the same time, we witness a sea shift in how business banking customers interact with their banks. The COVID-19 pandemic upended the way people do business and how they bank. Much more can be done remotely, and consumers expect a high level of convenience in their business banking services. Today, we look inwardly and ask ourselves an important question: What does the future hold for bank branches?

It’s been a tough few years

Bank branches haven’t had it easy over the past three years. With COVID-19 forcing shutdowns of branches in 2020 and changing customer expectations causing permanent shutdowns, some banking analysts have openly wondered if the future for bank branches looks grim.

During COVID-19, many banks across the country kicked their disaster recovery programs into high gear. At First Utah Bank, our employees worked quickly and diligently to ensure our services remained up and our customer base is taken care of. Our program worked particularly well and as a result, we were able to adjust to remote work for our back-office employees while adding necessary precautions for customer-facing employees.

Immediately following the pandemic’s onset, we quickly shifted to an appointment-based workflow. If someone needed to come into the branch, we made sure that they got the help they needed while taking necessary pandemic precautions to keep our customers and employees safe. We initiated new barriers, and signs and implemented a social distancing guideline. Our goal? To make customers feel safe and to promote our services. We wanted to make sure they knew that even if the branch was closed, the bank was open and helping its customers.

We used our branch as an asset. During a tough pandemic for our customers, we wanted to ensure we stayed available and had a central point to interact with our customers and provide services. Yet, not all banks and financial institutions were as lucky. Many big banks all over the country shuttered branches and put a renewed focus on their mobile offerings.

Banking trends point to closing branches

Although closing branches is a general trend in banking, no one predicts branches to fully go away. After all, companies rarely close their way to sustained growth. Still, closing a branch or two may make sense depending on the situation. Many banks are simply making changes to how they run their branches. While traditionally branches have been used for transactions, this role has declined significantly and what customers want has changed.

Whether fair or unfair, the banking and finance industries have developed a reputation for being slow to change or follow trends in other industries. There is a reason why the banking sector is considered a “legacy” industry. This comes down to two reasons. One reason includes the inherently conservative nature of banking. The second reason results from closer regulatory oversight. And yet despite this reputation, the banking world is beginning to change, particularly around branches.

The main reason for this change remains COVID-19. But it also has a lot to do with changing business banking customer expectations. So, what do business banking users in Utah expect in today’s banking environment? For one, customers no longer go to branches for routine banking needs like cashing a check or starting an account. In most cases, they can easily do that online.

Many wonder how banks will make the change from transactional branches to relational centers where employees can provide financial guidance to customers. To make this adjustment, banks are retraining their employees. In many cases, they are developing a kind of universal banker that can perform a variety of different tasks depending on the needs of the customer.

Business banking customers still want branches

While the role of the branch may be changing, it doesn’t mean business banking customers are abandoning branches altogether. They still expect their bank to have a branch. It’s simply that their reasons for visiting that branch are evolving. They can do many things online now, so when they visit the branch, they have very specialized needs.

It will be incumbent on banks and financial institutions to understand the needs of their customers and take steps to address them. At First Utah Bank, we’ve spent a lot of time evaluating what our business banking customers expect from our branch. Whether they need business checking, business saving, or SBA loan services, our branch bankers are ready to assist.

Are you looking for a community bank that puts a singular focus on your financial success? We’ve built a business around helping Utah-based businesses. And our branches are open and ready for business. Stop in and see how we can help you grow your business. Visit our website to see a list of locations: https://www.firstutahbank.com/