Over the past years, many banks have been forced to close branches but few of them have been working on rethinking their entire business models.
Most of the time, you will hear about digital and online solutions. In rural Germany, things are a bit different since banks have found a new and unexpected way to reconnect with customers by literally implementing ‘mobile banking’ instead of waiting for the client to come at their branch.
Juergen Schaller, a bank manager at Sparkassen, is now spending four days a week in his truck to bring mobile services, including cash machine and advisory, to tiny countryside villages.
According to a recent study published by KfW, the number of physical bank branches in the country has plunged by a quarter over the past 15 years to 35 per 100,000 people. The European average is 37 per 100,000.
As explained by Steffen Haberzettl, sales director at the Kronach-Kulmbach Sparkasse:
“It was primarily local businesses and older people who had not embraced online banking who were taking advantage of the mobile branch, which first set off on its rounds in 2015.”
Haberzettl estimated that around 20 people visited the bank at each stop, equivalent to 12,000 customer contacts a year. The number is of course much lower than the 8,000 online banking logins per day, but “we invested in this service for our clients knowing that it wouldn’t make enough money to pay for itself”, he said.
As explained by Maria Neubauer, a 70-something client:
“The Sparkasse bus is great for making transfers, or doing anything you need. We are happy, especially those of us who don’t have a car to visit a branch further away.”
According to Thomas Schnarr from consulting firm Oliver Wyman:
“The speed at which it will happen is hard to predict, and will depend above all on how the banks manage to keep branches relevant as a channel for their customers.”
What this initiative is teaching us is that human relationships remain fundamental, especially when retail and businesses clients have questions that require personalized advice.
This article was first published in The Local