Academic journal article ABA Banking Journal

Coping with Channel Creep: Online Banking Use Explodes but Branches Remain

Academic journal article ABA Banking Journal

Coping with Channel Creep: Online Banking Use Explodes but Branches Remain

Article excerpt

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A recent ABA-sponsored study of online banking seems to have galvanized bankers' thinking on the relative roles of branches, online banking, and mobile banking.

The survey of 2,000 U.S. adults found that 62% of them named online banking as their preferred banking method compared to just 36% last year. Overall, bank customers now prefer online banking more than all other methods combined. That compares with just 20% who said they preferred banking in a branch.

Given the large investment most banks have in branches, we asked a group of bankers if the survey results jibed with their situation, and how they were adjusting to the change. While not all those who responded agreed that the online channel was preferred by a majority of their customers, most did.

Jeff Smith, CEO of OhioValley Bank Company, $828 million-assets, Gallipolis, Ohio, noted that teller transactions are declining, while transaction accounts and online activities continue to grow. "Our electronic statement sign-ups are up over 400% in less than a year," he said. The bank set up a GenNext Advisory Board of young professionals to "tell us how they like to bank and how they expect a bank to look, feel, act, and interact. …

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