Over the years, the financial industry has been transformed with digital innovation and evolving consumer expectations. While it may seem like fintech and digital banking has taken over the industry, it's important to understand the vital role that physical branch locations play in modern banking. Financial institutions today require a careful balance between technology and human interaction; requiring a shift in branch layout, digital tools, branch identity, and consumer engagement. Continue reading to explore how these modern banking trends are shaping the future of financial institutions, and what it means for the industry standards moving forward.
The traditional branch layout that has served consumers for decades is being transformed with the newer generations who are looking for more. Traditionally, branches have been designed with a closed off, teller line-focused layout; with the majority of interactions centered around transactions. While this model has worked for decades, the rise of digital banking has reshaped how people manage their finances and what they're expecting from a branch visit.
More than 70% of consumers say they still want access to a physical branch for complex banking needs, even as digital banking grows. (Deloitte)
With mobile apps, online banking, and AI powered customer service, many day to day transactions no longer require a branch visit. However, in-person banking remains essential, particularly for complex financial services like mortgage consultations, business banking, and wealth management. Consumers still value human interaction and expert guidance, which has led financial institutions to rethink their branch strategies.
Today’s branches are shifting from transactional hubs to advisory-driven spaces. Open-concept layouts replace rigid teller counters, self-service kiosks streamline routine banking tasks, and technology integration enhances efficiency. Some branches feature digital consultation rooms, interactive screens, and virtual banking assistants to create a seamless bridge between online and in-person experiences. By blending physical and digital elements, modern branches are evolving to meet the needs of a new generation of consumers while maintaining the trust and personal connections that traditional banking was built upon.
Sun Community Federal Credit Union | An inviting and open concept lobby.
Like mentioned before, the branch is shifting toward advisory-based experiences. With the desire for personalized financial services on the rise, branches remain crucial for not only transactions, but focusing on consultations and financial education. Whether consumers are looking for mortgage advice, loan assistance, or wealth management services, face-to-face consultations provide a level of trust that a digital service cannot replace.
88% of consumers who highly trust their financial institution say they plan to bank with them long-term. (Forrester)
Focusing on your physical branch's amenities doesn't mean abandoning technology, many would argue it means the opposite. While ensuring your branch has the sought-after human touch, it's time to shift focus to the ever important technology integration. Offering welcome kiosks, ITMs, interactive displays and touch tables, digital signage, and upgraded AV technology are all additions that will improve relationships over time. With the modern branch being advisory-forward, it's important that many people still stop in the branch to complete quick transactions. Rather than cutting a conversation about rate options short to help another guest with a withdrawal, giving visitors the ability to complete quick transactions themselves provides everyone with a good experience.
Buckeye State Bank | A branded and tech-forward lobby.
Understanding the basic characteristics of consumers is a must in the current state of the financial industry. Where do your consumers live, shop, work? Are branches placed in convenient and accessible areas for a quick lunchtime deposit?
72% of consumers say that a convenient location influences their decision to visit a branch. (J.D. Power)
As important as it is to cater to visitors with in-branch amenities and perks, it is equally crucial to ensure branches are strategically located to fit into daily routines. Consumers increasingly seek seamless and efficient banking experiences, meaning a well-placed branch isn’t just a convenience, it’s a competitive advantage. A strategically located branch allows for quick lunchtime deposits, easy access for financial consultations, and a greater likelihood of repeat visits. By ensuring that branches are both conveniently located and equipped with knowledgeable staff, financial institutions can strengthen relationships, build trust, and encourage long-term loyalty.
Aerial photo of Reliant Credit Union | Location matters.