Typically when bank and credit union executives hear “video banking” they think of ITMs — interactive teller machines — units used for drive-up banking and in-branch kiosks. They’ve been around for years and a number of institutions have succeeded with them.
But now the technology has evolved, and so have consumer habits. Millions chat by FaceTime or Skype daily. Video conferencing has become commonplace in business. And of course people create and view videos constantly with their mobile phones.
So why not skip the trip to the bank and just video-connect on your phone with your favorite banking assistant to help you with getting a mortgage or setting up a CD ladder? Sure, you could just Skype them, if you had their number, but that wouldn’t allow you to view, exchange and even sign documents on your phone or laptop.
Being First in Market With Video Banking Pays Off
The software to do all that now exists and is already in use at a number of financial institutions, most of which are not big players. So video banking capability has the potential to be a real differentiator. Cobalt Credit Union, for example, is the only financial institution in Nebraska offering mobile video banking.
Operations Vice President Crissy Hayes, speaking during a webinar on video banking hosted by The Financial Brand, says the institution for many years took the approach common to many community financial institutions of waiting for others to innovate and then catching-up. That changed when they installed ITMs in 2016 and had great success with them. In the process they discovered they liked being the leader. Now, three years later they launched the next iteration — mobile video banking, building on their experience with the ITMs, and using the same team.
Rolling out mobile video banking had some unexpected wrinkles, the credit union found. For one thing, there is quite a difference in function between the typical ITM platform and mobile video banking. In Cobalt’s case the same vendor, POPio, supplied the two solutions. Whereas ITM transactions basically involve handling deposits, withdrawals and payments, with mobile video an institution’s staff would now have to be able to open accounts, take loan applications, handle wire transfers, and — trickiest of all — deal with things like requests to get a fee refunded. The job became a cross between a teller and a contact center representative, plus live TV skills.
Hayes says the core ITM group of seven people, which she manages, were excited to be able to open up video banking to a potentially much larger group of users, but were a little scared, too. Fortunately they were already comfortable with dealing with live two-way video so Hayes spent time getting the team members trained on the new skills they would need. She says it was a win from an employee-growth perspective.
Help for a Traveling Art Buyer
“This is not video chat,” states Jed Taylor, President of POPio. He describes video banking as a branch-like collaboration in which documents like photo ID can be exchanged and electronic signatures captured. It replicates the branch experience, complete with the human presence. The only thing it can’t do is dispense cash.
Indicating the versatility of video banking, which can be done on mobile phone, tablet or laptop, Hayes mentioned that one of Cobalt’s first interactions was with a member who called in from South America. He was in Peru on a trip to buy fine art but he needed the limit increased on his debit card, Hayes states. He was able to connect with a video banker on his laptop, have his ID verified and the limit raised.
During the soft-launch phase of the project, 80 video-banking sessions were conducted, Hayes states. After less than a month of marketing, sessions jumped to about 410. Cobalt offers video-banking service seven days a week, which Hayes describes as a game-changer in terms of meeting consumers’ needs to take care of banking outside of regular banking hours.
Commercial Bank Taps Video to Expand Retail Base
Several years ago, Royal Banks of Missouri opened many accounts online using an early software solution. As a result, the St. Louis-based institution serves consumers all over the country, says Michael Stevenson, Senior Vice President and senior retail officer. The bank also has business clients that travel a great deal for business.
Stevenson, who also spoke during the webinar, says the bank wanted to upgrade its capabilities to not only better serve clients remotely but to help them grow their retail customer base. They explored several options, but ultimately decided to leverage their experience using interactive teller machines to implement mobile video technology.
As the banker explains, the video solution offered more than an updated online account opening tool. It would enable them to expand customer service hours, enhance their mobile banking solution, and attract more checking, savings, and CD accounts. In time, Stevenson says, video bankers will take auto and home equity loan applications.
Not insignificantly, the ability to do wire transfers was a big plus for its commercial customers. “It gives us a secure way of knowing who we’re talking to through video chat with ID capture and signatures,” Stevenson explains.
The bank, which has $750 million in assets, opens about 70 new accounts a month says Stevenson. With mobile video banking platform, the bank is opening an additional 12 new accounts a month. He relates how in one case, the video banker hearing a customer’s dog barking, asked to see it — on his monitor. The banker then invited the customer to bring the dog into the bank the next time he was in St. Louis and they would have a treat for the pet.
“Video changes the experience compared with just speaking over the phone,” Stevenson states.
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Video, The Most Profitable Branch?
“Typically, financial institutions we work with manage their video call center as a branch unto itself,” observes Gene Pranger, CEO and Founder of POPio. A pioneer in the field, Pranger believes video banking, particularly when used on mobile devices or computers, may redefine branch banking in the future.
He maintains that a digital divide has opened between brick and mortar branches on the one hand, where there is human interaction, and purely digital web and mobile banking applications on the other, without any human interaction. Clearly digital banking has proven very popular for routine transactions, but it isn’t as effective, at least not yet, for more complex, or subjective, matters.
“That’s why I think mobile video banking is a means to fill the void of how financial institutions can interact with new accounts, drive new business opportunities and service customers in a much more efficient and human manner,” Pranger states.