Why some lenders are opting for video banking

The coronavirus pandemic has forced banks to adjust the way they interact with their customers, and many have beefed up their digital platforms to better serve their customers remotely.

Several banks have found success in their video banking platforms. Technology, they say, allows them to serve customers in a safe and convenient way, while giving them a personal touch.

OceanFirst Financial, based in Toms River, New Jersey, has been using video banking to connect with its customers for the past five years – an investment the bank says has paid off amid 15 months of social distancing and lockdowns .

“We have followed a multi-year trajectory to ensure that we are shifting our investment into digital and out of retail as our customers make those choices themselves,” said Chris Maher, CEO of OceanFirst. “[Digital] this is where transactions go, this is where our customers go, and this is where we make our investments. “

The bank with $ 11.6 billion assets operates 58 retail branches in New Jersey, Metropolitan Philadelphia and Metropolitan New York. By 2019, the bank had doubled the number of branches it now has, a testament to the scale of the bank’s shift to digital products, Maher said.

Customers have completed 220,000 video transactions over the past five years, Maher said.

“We are making thousands of them every month,” he said. “It’s a very efficient way for us to provide extraordinary service over a large geographic area with very few branches. “

The bank is expanding its video banking services to mobile devices and plans to provide full video chat capability in its call center by the end of this year.

The service, however, requires a significant investment in training the bank’s employees, Maher said.

“It’s not the technology that’s a barrier. Having a video session is a pretty straightforward thing. It’s okay to add this feature,” Maher said. “Adding dozens of bankers at OceanFirst who know how to video and how to connect in a professional and engaging manner is the barrier, and it takes years of hiring and development and recruiting to build a framework. people who are good at it average. Not everyone is comfortable with it. You have to be able to look through the camera, connect with people and listen.

OceanFirst operates a dedicated call center where it normally employs its video bankers, but in the midst of the pandemic, its video bankers are working from their homes, Maher said.

The bank is expanding its head office in Toms River, building a six-story, 80,000-square-foot space that will serve as a hub for its digital activities.

The bank has also grown its tech staff more than 11-fold over the past six years, from seven in 2015 to 81 now.

Maher said the bank’s investment in digital and video is a necessity as it shrinks its physical presence.

“You can’t consolidate a branch without investing in new infrastructure to serve your customers for the long term,” he said. “I don’t think the majority of banks are going to launch , but they may be forced to do so later. We are very happy with the customer satisfaction scores and the responses we get from our customers and we think this is a wonderful model, but it is a rare thing today. “

The bank has also improved its mobile banking app in recent years, adopting payment platforms such as Apple Pay and Android Pay, and a hybrid robo-advisor called Nest Egg, a digital product that customers can access through a video session.

American Bank

One bank that shares OceanFirst’s video banking embrace is the Minneapolis-based US bank. The $ 553 billion-asset bank recently added a video to its co-browsing service, a feature the bank introduced about a year ago that allows a customer to remotely share a screen with an employee of the American bank.

“We have thousands of these co-browsing sessions every week, and now we do them with video,” said Tim Welsh, US Bank vice president for personal and business banking.

The bank also recently added virtual appointment booking. Like many other retail banks, US Bank has relied heavily on scheduling branch visits amid the pandemic, making bank by appointment the default option in how she interacts with her customers.

For customers who want to interact face-to-face, Welsh said the bank has decided to give them a virtual option.

For the most part, bankers make video appointments out of branch offices, while some operate from a call center, Welsh said.

Welsh said the bank is working to put customers in touch with a banker working at a nearby branch.

“What we’re seeing is that even though people are connecting through technology, they love that the person they’re talking to is local,” he said. “This is not universally true, of course, not everyone needs this. But there is something about being able to say, ‘Are you enjoying the beautiful sunny day that we have. here in Las Vegas? ‘ – or whatever city you’re in. It generates a level of comfort that seems to be very useful. ”

The branch is still relevant, for now

Despite the investments in digital and the commitment their new video services are getting from customers, Maher and Welsh said they still believe the branch has a place in banking.

“Our efforts to secure digital customers are most successful in markets where we have a branch. So brick and mortar has value,” said Maher.

However, he said, the bank realized that it did not need the same concentration of branches in particular areas that it once had.

“The branch business area has become much larger, so branches are important, but they can be much further apart,” he said.

While some customers may continue to visit branches for simple transactions, like cashing a check, Welsh said he believes rudimentary in-branch transactions will decline as digital adoption increases. The majority of those who choose to come to a branch are likely to seek more tailored and personalized services from their bankers, he said.

“I think what’s exciting is the fact that you can now do these transactions in a more streamlined way. It gives people an opportunity to ask questions about technology or their finances that they might not have. haven’t been able to pose in the past, “he said. “The fact that you don’t have to run to cash a check now gives them the opportunity to have more important conversations, and I think that will continue. I hope that will continue.”

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