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The Future of the Branch: A Research Colloquium in Chicago

This colloquium explored what the future of credit union branches will look like as technology rapidly evolves.  

Executive Summary

To paraphrase Mark Twain, reports of the branch’s death have been greatly exaggerated. Or have they? While the future of the branch is being hotly debated at conferences, in journals, and across the blogosphere, one thing isn’t up for argument: that the branch of the future is likely to look quite a bit different than the branch of today. What kinds of branches should a credit union build in a world where mobile is increasingly ubiquitous, members expect the web to deliver not just content but functionality, and deep-pocketed technology players are lining up to enter the financial services space? How do a credit union’s strategy and field of membership impact its branching decisions? Which technologies will be branch must-haves in the next decade? And how should credit unions determine the effectiveness of their branch investments?

What is the research about?

At Filene’s colloquium experts from the worlds of academia, technology, and finance convened to address critical topics. The conversations were lively and the opinions varied. What came through in each presentation and the discussions that followed was a sense of both the possibilities and challenges that a rapidly changing world presents. This report summarizes the presentations and follow-up discussions from the colloquium’s four headline presentations, as well as an industry roundtable hosted by three credit union leaders who have approached the challenges of effective branch management in three very different ways.

What are the credit union implications?

Some of the implications shared by the presenters include:

  • Adding online resources may not increase the profitability of existing members, but it’s a critical must-have that can help credit unions to attract and retain new members.
  • As credit unions move from a stand-alone model where the branch is the gateway to all services to an extended enterprise model where credit unions partner with a growing array of providers, it becomes more critical than ever for credit unions to take a holistic approach to managing their technology and delivery channels.
  • Rapid adoption of mobile banking and member demand for full-function online channels mean that future investments in physical locations can be waste of credit union resources

This report is sponsored by CO-OP Financial Services.