• Mark Aldred, Retail Banking Tech Expert at Auriga


• 29.11.2022 06:30 am
#banking

“Rewinding the clock on lost access to cash and services?

In 2022, most banks assumed that pandemic behaviour was forever. This accelerated plans to shutter banks and slash ATM networks. As we go into 2023, those pandemic behaviours are being eclipsed by how economies are struggling, and individuals and businesses are all finding it tougher to get by. We are already seeing a return to the use of cash in the cost of living crisis.

So many of those decisions taken in 2022 may need to be revisited. Cashback without payment at retailers was launched in some markets like the UK. it's a reasonably good idea but one that may struggle. And it's not just about access to cash, of course, but access to all banking services especially as more people seek advice and help. I think in 2023, we'll see government and regulators also intervening to slow the pace with which banks are driving people on to digital channels only.

Getting serious about Shared Banking Hubs at last!

The Cash Action Group, Post Office and other stakeholders are to be congratulated on the shared hub initiative. But, the pace of roll-out and the one size fits all approach means that consumers of financial services, including cash, continue to lose access to them.

Like Link’s community ATM initiative which has seen the return of around 100 of the more than 6,000 lost ATMs, the 25 or more planned Post Office Hubs will barely scratch the surface of how families, businesses and communities have lost access to more than 3,000 branches over the last 5 years.

While there’s a will to push back the tide of closures, there is the danger of it turning into a King Canute demonstration in futility.

Fitful experimentation about how banks could share branch operations must come to an end in 2023 when we expect to see some serious work on shared banking hubs. But these cannot be ersatz branches that offer little more than a paying-in service or guidance on how to use mobile banking.

White-label branches should incorporate digital self-service hubs that provide full access to branded banking services 24/7 using automation and video banking. This new kind of branches will be something that involves not only the legacy banks. Neo-banks are going to take a serious look at the concept as they don't have the ability to engage physically with their customers, and bring them into a safe space to engage with them.

More Smart Tech in the Next Gen Branch and Shared Hub

More effort will be needed to avoid these new style branches becoming white elephants. Technology choices will be key. There needs to be a careful use of AI and machine learning to help customers of all generations navigate through new self and assisted service experiences more easily and quickly. This will increase adoption, and therefore the success of the new branch models including shared hubs.

The use of more advanced digital self-service technologies could provide real and regular access not just to cash, but to a range of financial services and advice, even 24/7.  This can support a hub and spoke model that ensures services are deployed at a lower cost, more functional, and more available. The hub provides a centralised resource of expert financial services that can be remotely delivered via local “spoke” settings. Capable of deployment in multiple settings, including mobile, and supported remotely such that subject matter expertise is accessible to support customers through even the most complex transactions. This could encourage more financial services firms to participate, increasing the number and range of providers whose customers can access the services offered

Going Dutch to Revive ATM Networks

ATM pooling is something else that should proliferate in 2023. For banks under political and public pressure on access to cash, this approach squares the circle well. As examples in Belgium and the Netherlands show, it allows banks to save operating costs while actually opening up ATMs in towns and villages which have never had an ATM before.”