How the impact of COVID-19 could accelerate next generation bank branch transformation

COVID-19 and the lockdown has had a profound effect on all aspects of our economy and society. This includes banking and access to money. Indeed, as recently reported in Finextra,  MPs wrote to the Chancellor and asked him to act now to protect the UK cash infrastructure from imminent collapse, as people shun ATMs  due to the Covid-19 outbreak.

The extent to which the current situation accelerates use of digital cash permanently is yet to be fully understood even as lockdown is now easing and we plan for economic recovery.

Like before the crisis started, I believe it is vital that the ATM infrastructure is protected. If these digital banking lifelines are left to wither and die, then more people and communities will be denied access to not only cash but also high quality services that ensure and promote financial wellbeing for all.

Of course, lockdown did reduce movement and in person purchase volumes and therefore the short term need for cash. This was reflected in lower volumes of  ATM withdrawals and while this might be interpreted as fear of “dirty cash”, there is no truly clean alternative, even with contactless.

So, it’s good to see the UK's biggest ATM network Link reporting signs of recovery in cash withdrawals from ATMs as the lockdown has eased here. But, we shouldn’t be complacent about things returning to normal and must continue to be vigilant on how the UK ATM networks are protected for the future.

Economic recovery following COVID-19 lockdowns will depend on easy access to cash, which, in these difficult times, will still be the preference of many people, and the only option for some.

While we wait for a government response on the call for financial support to protect the network, it is good to see that the ruling from the  Supreme Court that has confirmed that ATMs are not separately rateable when installed in supermarkets or convenience stores. This eliminates a another serious obstacle to the survival of ATM access in the community.

COVID-19 could be a catalyst for positive change, bringing banks closer and more engaged in the lives of their customers. Key technologies that could flourish include more user friendly and feature-rich self-service and assisted-service ATMs,  integrated secure video banking to offer access to human tellers remotely and AI to accurately predict the amount of cash needed at each banking touchpoint and personalise services generally.  Even before the pandemic, such approaches were  key for how banks can have a powerful presence in our local, and sometimes remotest, communities.

Banks must invest in and extend the channels available to customers in-branch as well as online and mobiel channels. The bank branch remains a totemic sign of how much a banking brand is part of our communities and so we must see more creative and technological investments in its preservation and growth as a hub for local financial services and support especially as our communities seek to recover from the economic effects of lockdown measures.

Of course, the prevalence of social distancing will change how branches are laid out and technology can play a part here to, for example how smarter self-service machines can reduce the need for physical in-branch interactions with tellers and how video banking can enable face to face consultations and assistance.

Let’s hope that banking, like all other parts of our economy and society, comes out of this crisis stronger not weaker. And, that the crisis accelerates, rather than reverses, recent impressive innovations made by banks  in digital self-service banking and next generation branch transformation.