Shared Branching Creates a Ubiquitous Service Channel.
In June 2015, CO-OP Financial Services announced that the unique credit union industry solution of shared branching had reached more than 5,300 locations nationwide, making CO-OP Shared Branch the third largest network among financial institutions -- bigger than Bank of America.
There is no other branch network that has locations in all 50 states and the District of Columbia. Here are some other "fun facts" that tell us shared branching is creating a ubiquitous service channel for credit unions:
* There are more than 1,800 credit unions participating in CO-OP Shared Branch (approaching one third of the nearly 6,400 credit unions in the U.S.).
* More than 55 million credit union members have access to shared branching through their credit unions, which equals more than half of the 102 million U.S. members.
* Arizona, Maine, Colorado, Alaska and Mississippi are the top five with an average of 90% of credit union members in these states having access to shared branching in Q2 2015.
* Maine (88%), Alaska (67%), Arizona (61%), Colorado (59%) and Washington (59%) take the lead in terms of the percentage of credit unions enrolled in shared branching.
* According to Callahan & Associates, the total number of credit unions nationally fell by 3.2% by end of Q2 2015 from Q2 2014. On the other hand, the number of shared branch credit unions increased by 1.9% by end of Q2 2015 in comparison to Q2 2014. Additionally, the number of non-shared branch credit unions in the nation decreased by 5.5% by end of Q2 2015 compared to Q2 2014.
* At 5,300 shared branches today, the number just keeps climbing. In fact, the sky truly is the limit. If every credit union in the country participated in shared branching, there would be more than 21,000 branches available to our members.
For all the advantages enjoyed by banks, shared branching is the one channel no bank will ever have. It is the tangible demonstration of credit unions' willingness to work together on behalf of all members, ensuring convenient services to members wherever they may travel.
There are at least three reasons why the shared branching concept will continue to help power the growth of the credit union movement well into the future:
* The concept is now at the forefront of the industry's need to transform branches.
* Shared branching is helping credit unions address the demands of the modern consumer for true omnichannel access, smoothly combining online, mobile and in-branch touch points.
* And, branches even provide an avenue to attract a new generation of members.
Branch Transformation and Alternative Payments
The credit union movement did not build up the shared branching concept because branches are cheap and plentiful. Quite the opposite! Branch transactions are declining and the cost of branches are going up. Yet branches will not go away -- they are changing.
It has, thus, become even more important that the branches credit unions do have are shared.Sharing a branch will bring in more transactions -- transactions that bring in revenue, unlike when your own member comes in to do a deposit or withdrawal. For credit unions reticent to close branches, opening their existing branches to shared branching is a way to bring in income and transactions. And, for credit unions considering closing branches -- who are rightly worried about how that will play for members who like branch service -- their solution is to join shared branching. The concept, in fact, provides a smooth transitional glide path for lowering branch count.
No matter what your branch strategy is -- add branches, "transform" them, close them -- the fact is your members are still going to need locations everywhere. Participating in shared branching solves your problem in a single decision.
With shared branching, credit unions also have access to the new world of mobile banking and P2P payment technology.
The modern consumer wants it all -- mobile, online and branches -- and they expect all access points to work together in a single harmonious, delightful user experience. In the case of CO-OP Shared Branch, the same network that enables account transactions across branches also facilitates emerging payment methods. All would be integrated to make your work -- and the member's! -- simpler, easier and more powerful.
Credit Union Services for a New Generation
Finally, branches continue to be attractive to a new generation of members.
According to a study by the Board of Governors of the Federal Reserve System, "Consumers and Mobile Financial Services 2015," 87% of consumers who have a bank account report that they had visited a branch and spoken with a teller in the 12 months prior to the March 2015 survey.
Younger consumers are also relying on branches to get personal advice, according to the J.D. Power "2015 U.S. Retail Banking Satisfaction Study." The study reports that 74% of Gen X consumers (born after 1965) had visited a branch up to 12 times in the previous 12 months, as had 72% of Gen Yers (born after 1980) and 76% of Gen Zers (born after 1995).
"Virtual world" younger consumers simply like the touch and feel of the real world.
Credit unions looking for deeper market penetration are going to need to provide multichannel access to meet members' expectations. The industry's network of shared branches offers an ideal entry point to everything the movement has to offer the modern consumer.
Sarah Canepa Bang is president and COO, FSCC, LLC and Chief Strategy Officer for CO-OP Shared Branching. She can be reached at 800-782-9042, Ext. 1205 or firstname.lastname@example.org.