Bank Branches Are Turning Into Sales and Service Outlets

Banks today use self-service capabilities to address customer needs using technology. You add processing support, an activity that does not require any mental discretion is increasingly getting parked at centralized back offices. Most support services today have become centralized, bringing down the bank’s staff workload.

Today, even when you walk into a bank, you would have automated machines handling most of your transactional requests – cheque book requests, pin change requests, deposit, and cash withdrawal, depositing a cheque for clearance, passbook printing, and account statement printing.

Most of these things used to be done physically by the staff earlier, which is now automated.

In essence, the bank branches have turned into sales and service outlets. Transactions don’t happen through the human interface anymore.

What Else Is Automated?

The other day I opened an account within 5 minutes, which was unheard of a few years ago. All I had to was approach the ‘May I help you’ desk at the branch. I told the lady behind the counter I wanted to open an account. She checked with me for my identity proof and PAN card.

I submitted both of them – she opened the bank app on her mobile phone, scanned both documents I submitted, and asked me to deposit 10K into my account.

Immediately, she gave me the kit containing my Debit card, cheque leaves, and the customer number to access Internet banking. When I reached home, my account was active, and I could do all forms of transactions – UPI and Internet transactions.

This is Sales 101 at banks today. They have made it really easy. During this process, they also did the KYC verification by scanning my documents. They have extended it to loan processing, wealth management, and advisory services.

Operations Support Subsidiary

Recently, the State Bank of India was granted in-principle approval by the RBI to set up an operations support subsidiary (OSS) to improve operational efficiency.

What does this mean?

Now, the bank can outsource several support processes – the non-core, one-off activities for which you don’t need to access customer accounts can be outsourced to cut costs and efficiency.

Implementing an OSS model should ideally improve the profitability of your business. I am sure it results in operational efficiency, but I am not sure about the profitability.

To understand this, let us look at the transactional costs of banking services – infrastructure, manpower, and business process. Infrastructure includes both physical and digital, which will only change incrementally once implemented. The business process, including the compliance needs, is a must-have and cannot be avoided.

Manpower is where the biggest impact would be. The manpower at the branch level and at the OSS level is not optimally utilized, and they have a lot of idle time, which is a cost to the bank.

How Do You Optimize Manpower?

At the OSS level, this can be managed as you can deploy workforce management (WFM) and workforce optimization (WFO) solutions that can help you understand the workload and distribute them to the available resources. It ensures that the right query gets routed to the right resource at the right time.

Your OSS need not be location-dependent, and the cloud infrastructure deployed for the OSS along with WFM and WFO can route requests across geographies. This way, the idle time can be considerably reduced at the support center, and you can optimally utilize your resources.

As a bank, you need to create an ecosystem that can offer the best possible experience to your customers – irrespective of whether they choose to visit your branch or reach out to your customer support.

The banking industry is moving towards making banking simple and easy with automation, and it can only get better from here.