Innovating the branch teller system to meet consumer needs

While the old adage ‘if it’s not broke, don’t fix it’, has suited the banking industry well for decades, it’s now reaching the point where while systems may not be broken, they’re certainly not suited to today’s fast-paced, technology-centric world.

Let’s take the branch teller system. Most financial institutions (FIs) still have some of the same software code installed since the 1970s when they first brought technology to this area of the business. Despite being introduced before the internet, smartphone and wi-fi, not much has changed for the teller system.

So, when you’re standing in line at the branch, getting frustrated with the amount of time it takes to do a simple transaction like getting a bank draft for that new car, think of the teller. They are being “tortured” by the archaic systems they have to use, which are slow, clunky, siloed and require them to go across multiple screens or applications to complete a single task.

But the branch model is transforming to better align to the needs of customers, who increasingly handle their day-to-day needs via digital or self-service channels. The branch still plays an important part in the banking mix, but the future of the branch is most certainly led by self-service technology, with bankers providing a more advisory role. Indeed, there will soon not be a ‘traditional branch’ as FIs evolve their face-to-face engagement to match with customer need.

Indeed, Gartner® says that financial services retail banking leaders seeking to optimize their branch footprint should consider five models that tailor physical space to the needs of their customers, in its  infographic The 5 Branch Models of the Future.

In its ‘Technology Trends Previsory for Retail Banking’, global research and advisory firm Celent recognized optimizing customer engagement and delivery as one of its top 5 technology trends for retail banks in 2022. But with 43% of financial institutions reporting disconnected digital and assisted channels as one of the key pain points and an area for improvement, there’s a need for FIs to modernize their teller systems to give staff a complete view of their customer. As the Celent report also shows only 51% of FIs provide staff with tools to resume a customer’s transaction or view an application in real-time, while only 41% make it possible for staff to assist or complete an application for the customer.

So, that means that FIs need to look closely at modernizing their teller systems to enable their staff to better serve their customer in this shifting landscape – and enhance their working environment too. Staff too are accustomed to the ease and simplicity of today’s smartphone and tablet UIs and similar, intuitive systems in the FI will make their day-to-day much easier, productive, and enjoyable.  But as customers turn more to self-service channels, it’s increasingly important that bank staff have a full view of customers’ activities and be able to jump in when they hit a problem to aid completing the transaction. And it’s important that this works across all channels, so the customer can reach out via whichever touchpoint they prefer, be it remote teller, call center or in branch, with staff given the tools at their fingertips to find the in-progress transaction or application and step in to complete. If the consumer has to start that mortgage application again from scratch, they’re more likely going to abandon or go elsewhere.

While customers take for granted the retail experience, where the connected omni-channel experience has been nailed, the reality is much different when it comes to banking services. The challenge is most bank staff have very little visibility into their customer. Traditional teller systems are siloed focusing solely on the transactions at the branch counter, so anything customers do online, on their app or at the ATM can’t be seen.

With evolving customer expectations, the answer seems easy – FIs need to upgrade. But it’s not so simple. It’s not as quick as modernizing systems. These archaic systems aren’t built to evolve easily so upgrading them is costly, time consuming and resource intensive. But as FIs take steps to modernize the legacy system, there’s emerging a patchwork of legacy and modern software which places the FI at systematic risk from myriad of aged and new code used in bank systems.

The most popular solution is to unbundle the legacy system and replace with an API- and microservices-driven platform that will enable FIs to easily connect all aspects of their business to a centralized system. This approach is the most efficient and cost effective, with the least impact on daily operations as it can be deployed and updated in smaller phases rather than a complete rip and replace. What’s more, it puts FIs in the best place to evolve in the future with the flexibility to easily add new services, functionality, and niche partners.

According to IDC, in its The Rise of the Connected Experience whitepaper, monolithic systems and applications are a key barrier to delivering omni-channel experiences for 32% and 36% of global FIs respectively, particularly in North America and Europe.

Migrating the teller system to a cloud-based platform gives FIs an agility they didn’t have before. They can now easily add new services, applications and functionality fast and cost-effectively or connect to fintechs and third parties, enabling the FI to continue to meet the evolving needs of the customer.

This can help further transform the function of the branch and provide greater convenience to customers. By adding services such as mobile remote check depositing, customers can bank their checks from their kitchen table while the process is automated for both customer and FI saving time and improving efficiencies. Or enabling customers to pre-order specific denominations for bulk cash orders providing convenience for customers and reducing transaction times in branch.  

Importantly, for those interacting with customers, all customer channels can be linked to the platform, providing not only a 360 view of the all the customers activity with the FI but also the ability to jump in on a transaction and provide the support to complete it whatever touchpoint the customer is using.   

However, as FIs make upgrading their teller system a key part of their strategy, one thing is clear – the need to modernize is vital. Today’s customers expect FIs to have an omnichannel view and the teller is on the front line.  As new competitive offerings in the banking space continue to emerge, wowing customers with convenience of a digital-first approach, conventional FIs have to modernize to keep up. But customer expectation is not the only reason, having a modern architected teller systems enables FIs to converge their channels and gives staff a system that’s easy to use, quick and intuitive to complete tasks with a modern UI that’s enjoyable to use day in and day out. 

^{*Gartner, “Infographic: The 5 Branch Models of the Future”, Refreshed April 19, 2022.­}

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