Say you’re not feeling terribly well and think you need a doctor’s visit. What do you do? It used to be that you got on the phone and called your healthcare provider, made an appointment, and sometime later, showed up at the provider’s office. Now what do you do? You get on your phone or home computer/laptop and onto your healthcare provider’s website, make an appointment, and sometime later, your provider “pings” you and you visit with him or her while sitting on your living room couch.
I’m wondering… if I can visit with my doctor via video, why can’t I visit with my financial advisor or loan officer in the same way? While it seemed to be a hot topic just a few years back, there seems to be surprisingly little discussion of video banking these days. The “digital transformation,” and how critical it is to the community bank’s survival, is still in the news daily, with bankers being warned on a regular basis by tech providers that if they fail to offer a totally automated, lightning-fast online banking experience that they’ll surely find themselves on some substandard-digital-banking-experience scrap heap. And, out of a job. So, why so little interest in taking your digital transformation a step further with video banking? Especially when, according to a Forrester report, adults surveyed said that they would much rather do their banking on their laptop or phone than visit with a person at a branch?
Given the digital transformation, and the need that customers have for real, face-to-face guidance when it comes to financial products, why aren’t more community banks offering video banking? Wouldn’t it be great if customers could have a video call with a bank staff member, using their desktop, tablet, or smartphone and get advice from a financial advisor while at home, at the office, or on the go? According to Deloitte, three quarters of U.S. retail bank consumers want their banks to provide financial advice or guidance, and sixty percent of consumers told Deloitte they want that guidance delivered digitally.1
Just recently, a Windstream Enterprise survey reported that 72 percent of C-suite executives indicated that video banking is a critical area for their business and that attracting/retaining digital customers is also a top priority. Imagine a highly valued customer has a quick question for her favorite banker. In the modern era, this customer would rather meet face-to-face but doesn’t want to worry about the health risks or travel time of visiting the branch. Rather than pick up the phone and call, this customer prefers to discuss their account question over a video call.2
So, why isn’t video banking more prevalent, when nearly 75 percent of C-suite executives see it as important? I’m not quite sure. What are the downsides? A few years back, that obstacle seemed to be technology, but the technology is certainly here now. Is it security and compliance? Could be, given the myriad number of regulations that banks face when implementing technology of any kind. As usual, the restrictions and constraints put on this type of technology have evolved as fast as the technology itself. Here are just a few that apply to the use of video banking.
- Gramm-Leach-Bliley Act: This law requires financial companies to share information-sharing practices with customers and safeguard sensitive customer data.
- Equal Credit Opportunity Act (ECOA): This act’s non-discrimination requirements apply to interactions by video, as well as those in person. Bank Secrecy Act: Large and suspicious transactions don’t have to occur in-branch to fall under this law’s reach. Many records around certain transactions must be maintained for up to five years regardless of how the transactions are made.
- Interagency Guidelines Establishing Standards for Safety and Soundness: This regulation includes several components requiring strict operational and managerial standards for internal controls and information systems and follows safeguards to protect the security, confidentiality, and integrity of customer information.
Back in 2018, Businesswire reported on just how much consumers love video banking. “In addition, those organizations that have a fully deployed video banking service cite positive customer/member experiences and improved perception as the main benefits of the initiative. Survey findings highlight that:
- 65 percent report an increased perception among members that their organization is an innovator.
- 56 percent report increased customer/member satisfaction.
- 56 percent report faster customer/member service.
- 42 percent report better customer/member intimacy.
- 25 percent report increased customer/member loyalty.
- 21 percent report that video banking is a driver in recruiting new customers/members3
So, what happened? Is the seeming lack of interest due to cost, the challenges of implementing a new technology, the fear of a compliance misstep? I don’t know. But I do know that video banking can bring customers, and community banks, the best of both worlds: the convenience of a digital experience and the personal connection that only community banks can offer.
As always, I would love to hear your thoughts on this subject.
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To view our marketing creative, both print and digital – ranging from product and brand ads to in-branch brochures and signage, visit bankmarketingcenter.com. Or, you can contact me directly by phone at 678-528-6688 or email at nreynolds@bankmarketingcenter.com.
1Deloitte. “A Vision for the Future of Retail Banking” 2022.
2Windstream Enterprise. “Is your financial institution compliant when using video chat?” June 28, 2022.
3Businesswire. 2018. “Global Survey: Online and In-Branch Video Banking Experiences Yield High Consumer Satisfaction.”