Synechron, Inc, the financial services consulting and technology services provider, in partnership with Efma, has today released a report revealing that c-suite banking executives largely believe that the future of the bank branch is bright, with the proper investment into digital transformation.

The report surveyed decision-making bankers from across the globe in order to examine the role bank branches play in the current digital era and in a time of mobile-first thinking, and gather insight into where branch banking is trending.

With experience in digital branch transformation, Synechron sought to focus around four key areas, including the current market perception of the bank branch, where banks are investing in branches, how new technology can enhance the branch model, and what role staff will play in the bank of the future.

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The survey showed that 88% of respondents believe physical branches add value to customers and will play a role in the future of banking, but nearly a quarter (24%) intend to increase their branch network and invest in changing the model. Yet nearly one in four (39%) said they plan to decrease their branch networks whilst investing in change to the current model, while 63% of respondents are planning to change their branch model in line with digital transformation.

Over recent years, the number of bank branches have been in steady decline with significant closures across the US, Europe and the UK. However, this new research suggests that 88% of the bankers surveyed believe that physical branches add value to customers and will continue to play a significant role in the future of banking.

David Horton, head of Innovation, Synechron, said: “Bank branches have played a critical role in the development and success of retail banking in modern times and they will continue to play an important role, but our new report with Efma shows that the model must change and adapt to support todays digital customer. Through digitisation, the bank branch can reinvent itself to improve the experience for the customer while maintaining the personal and emotional connection which many customers value so highly. The coming years will prove significant for retail banks as they look to evolve their value proposition, acquire new customers, and retain existing one’s through a culmination of digital and physical services.”

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Retail and consumer bankers are predominantly looking towards technology to improve the in-branch customer experience and evolve the role of their staff as opposed to motives around reducing cost and reducing FTEs.

The top focus area for branch transformation as identified by those surveyed is to improve customer service/engagement, which 42% identified as a priority, followed closely by the evolution of the role of branch staff (40%). This, however, is followed closely by introducing digital interactive experiences (38%) and self-service automated technologies (36%).

The bank of the future will continue to have a physical presence, as 97% of bankers agree that only people can bring an emotional connection to the bank, and their role will be focused on bringing the relationship connection with the bank.

However, 62% of respondents are planning to reduce overall headcount in bank branches. While the traditional branch model historically was centred around transactions, the branch of the future will evolve to serve as an advisory service hub, complimented by digital experiences and employing bankers with specialised skills that combine sales and service responsibilities.

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Vincent Bastid, Efma Secretary General, said: “We are at a digital crossroads within the banking industry, and while digital and emerging technologies are taking the lead, our survey with Synechron confirmed that banks still value the physical bank branch, and are looking for ways to merge the two experiences to gain the best outcomes for both banks and their customers. Prioritising digital is no longer a ‘nice to have’ addition to a bank, but is critical in shaping their future strategic bank initiatives and the future of customer experience in the branch.”