19 October 2017
Find out more

Branches hold strong in face of digital onslaught - FDIC

20 February 2015  |  9501 views  |  2 Westpac branch

Despite the rise of online and mobile banking, there has been only a modest decline in the number of branches in the US over the last few years, according to research from the Federal Deposit Insurance Corporation (FDIC).

As of June 2014 FDIC-insured institutions operated 94,725 banking offices, a decline of just 4.8% from the all-time high of 99,550 in 2009. In fact, over the last few decades the number of US bank branches has generally grown in line with the population, only experiencing dips during the banking crises of the late 1980s and the last few years.

Since 1970, banks have introduced a series of new electronic channels for delivering banking services - ATMs, phone, online and mobile banking. Yet between 1970 and 2014 the total number of banking offices grew nearly twice as fast as the US population, and as of 2014 the density of banking offices per capita was higher than it had been at any point prior to 1977.

However, the emergence of new technologies does appear to have had an impact on the number of transactions taking place at branches. According to one study cited by FDIC, the average number of teller transactions per office declined by 45% between 1992 and 2013, from 11,700 per month to 6,400.

Young people in particular are making fewer visits to branches, with a recent survey finding that 19% of people aged 18 to 29 visited a bank or credit union branch in the previous week, compared with 29% of those ages 30 to 49.

Even so, branches are still valued by Americans, with a 2013 FDIC survey finding that visiting a teller remains the most common way for households to access their accounts, leaving mobile and online trailing.

Says the FDIC: "In terms of technological change, there is little evidence that the emergence of new electronic channels for delivering banking services has substantially diminished the need for traditional branch offices where banking relationships are built."

Read the full study here:» Download the document now 2.9 mb (PDF File)

Comments: (2)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 23 February, 2015, 07:44

FDIC is spot on - just that the "need for traditional branch offices" may be felt more by bankers than their customers:

Secret Of Survival Of Bank Branches

1 thumb up! 1 thumb up! (Log in to thumb up)
A Finextra member
A Finextra member | 23 February, 2015, 14:29

Best not bite the hand that feeds you. Moven makes a point that amounts held with it up to $250,000 are insured by the FDIC: "That's a briefcase full of money". Where can you get that much in readies? Surely only from a bricks-and-mortar branch, even if it is in some remote part of Kansas, like 109 E Main St, Weir (where the issuer of the Moven card resides).

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Idea Bank takes on coffee shops with new branch concept

Idea Bank takes on coffee shops with new branch concept

16 February 2015  |  11104 views  |  1 comments | 17 tweets | 17 linkedin
Bank branches will save banks from digital challengers - Botin

Bank branches will save banks from digital challengers - Botin

03 February 2015  |  18855 views  |  32 comments | 37 tweets | 26 linkedin
North American bank IT spending to reach $62.2 billion in 2015 - Celent

North American bank IT spending to reach $62.2 billion in 2015 - Celent

29 January 2015  |  8234 views  |  0 comments | 22 tweets | 9 linkedin
US banks continue to trim branches

US banks continue to trim branches

14 November 2014  |  6713 views  |  0 comments | 6 tweets | 3 linkedin
Citi outlines plans to shrink the bank branch

Citi outlines plans to shrink the bank branch

05 November 2014  |  6359 views  |  0 comments | 6 tweets | 4 linkedin
More branches to close as UK banks retreat from the high street

More branches to close as UK banks retreat from the high street

03 November 2014  |  10263 views  |  1 comments | 9 tweets | 12 linkedin
Americans embrace mobile banking but the branch makes comeback

Americans embrace mobile banking but the branch makes comeback

26 August 2014  |  10193 views  |  8 comments | 21 tweets | 15 linkedin
Branches on the precipice as Brits embrace digital banking

Branches on the precipice as Brits embrace digital banking

08 July 2014  |  12606 views  |  2 comments | 16 tweets | 21 linkedin
US banks collectively cut 1500 branches last year

US banks collectively cut 1500 branches last year

28 January 2014  |  6035 views  |  1 comments | 13 tweets | 4 linkedin
Bank of America employees picket video teller ATMs

Bank of America employees picket video teller ATMs

26 November 2013  |  6674 views  |  0 comments | 4 tweets | 5 linkedin
US branch transaction volumes see eye-popping decline

US branch transaction volumes see eye-popping decline

24 May 2013  |  8166 views  |  0 comments | 16 tweets | 9 linkedin
Digital to overtake branch for transactions by May - NAB

Digital to overtake branch for transactions by May - NAB

28 February 2013  |  9806 views  |  0 comments | 14 tweets | 8 linkedin

Related company news

 
visit www.capgemini.com visit www.vasco.com

Top topics

Most viewed Most shared
Ripple looks to drive bank adoption with $300m XRP rebate programmeRipple looks to drive bank adoption with $...
15820 views comments | 12 tweets | 4 linkedin
Swift positive on blockchain, but big challenges remainSwift positive on blockchain, but big chal...
8954 views comments | 16 tweets | 22 linkedin
satelliteGates Foundation backs Ripple collaboratio...
8051 views comments | 13 tweets | 10 linkedin
IBM uses blockchain to improve cross-border payments processingIBM uses blockchain to improve cross-borde...
7147 views comments | 9 tweets | 17 linkedin
Santander InnoVentures leads $6m funding round for Mexico's ePesosSantander InnoVentures leads $6m funding r...
6288 views comments | 6 tweets | 3 linkedin

Featured job

Find your next job