The Great Recession had a minimal impact on branch growth across the industry. The total branch count during the financial downturn reached a record-high 21,504 in the third quarter of 2010. Branch count then remained steady until the third quarter of 2012, when the number of branches decreased by 536 quarter-over-quarter and the number of total credit unions decreased by 75.
Since then, branch numbers have hovered around 21,000.
For the first time since 2005, credit union charters (5,859) outnumber bank charters (5,856) in the first quarter of 2017. Conversely, total institution counts for credit unions declined faster than banks.
The total number of credit unions has declined 35.3% since 2005 versus a decline of 33.7% at banks. This provides a different angle to the branching story. Perhaps credit union merger and acquisition activity is resulting in charter numbers declining faster than active branch numbers, in turn, raising the average number of branches per institution.
In any case, credit unions need to be ready to align their brick-and-mortar branches and overall operations with a future of financial services wherein customers choose mobile and online channels over branch visits. One way a credit union can do this is by establishing their contact centers as omni-channel hubs for customer interactions. Contact centers can be a powerful tool for digital transformation in the new era of financial services.
Bain & Company has highlighted multiple ways to transform contact centers into a mission-critical core of the institution. The company’s suggestions include:
Consider the end-to-end customer experience. Contact centers are distinctly positioned to identify friction and failure points in the digital experience. Callers can provide valuable insights into how credit unions can improve the digital experience.
Actively manage customers’ migration to digital. Contact center agents can help drive digital adoption by prompting members to do more of their routine transactions digitally. As members adopt the digital way, agents can devote more time to supporting complex interactions and advising on higher-value products.
Train and reward agents. Agent scorecards should be less oriented around internal metrics and more aligned with customer outcomes such as call interaction or the Net Promoter Score. The NPS is a proxy for gauging the customer’s overall satisfaction with a company’s product or service and the customer’s loyalty to the brand.
Take advantage of technology. Give members choices for interactions that go beyond phone, email, chat, and social media. Video and co-browsing, for example, provides a richer experience for members.
Be agile. Take feedback from members and bounce ideas off front-line employees to improve and innovate products and services.
Building a dynamic, customer-focused contact center is not an overnight project but can be well worth the investment. As a central pillar of operations, the call center can improve the customer experience and promote the migration to digital for the credit union and its members.
Credit unions might be reducing their branch square footage and converting branches to technological hubs, but the notion that the branch is dead has been exaggerated.