I know that I have argued, on this very blog, that banks should still invest in branches, but that was before I heard about a new, disruptive innovation—Mailway Banking.
I can’t believe I hadn’t heard about this until now. I stumbled upon this innovative new channel in a magazine ad of all places. The concept, as you can see in the ad, is to provide a more convenient banking experience to consumers by allowing them to conduct their banking transactions (whether it’s checking or savings, business or personal) through the mail. Using special envelopes and passbooks, consumers can interact with their bank entirely through their mailbox.
Just think of it. All the frustrations of modern banking—waiting in line for the teller, rushing to the branch before it closes, delaying your banking transactions for Sundays and Holidays—gone. Crocker First National Bank and their Mailway banking are going to completely revolutionize the way consumers interact with banks. Imagine how excited Generation Y consumers are going to be when they get their hands on this. The generation that devoutly believes in the power of technology to make everything better, faster, smarter. This generation can’t wait for technology to deliver them from the inefficiency of branch banking. Well Gen Y’ers—technology has finally delivered.
I think Crocker First National Bank is ushering in the future—a post-branch world. Consider this blog post a retraction of my previous opinions on the health of branch banking. Consider this blog post my way of hopping on board the revolution of Mailway Banking.
Editors Note: It turns out that the magazine ad the author references is a little older than he thought. Below, please find the author’s amended thoughts.
So it turns out that the magazine ad in question is from 1944. Crocker First National Bank was certainly an innovator, but their innovations have long since entered into the history books. And guess what? Branch banking is still here. It survived that disruptive young upstart named Mailway Banking, it survived the rise of telephone banking, and it survived the introduction of ATMs (which incidentally, Crocker First National Bank helped pioneer). The introduction of more convenient banking channels has not killed branch banking, despite the continual predictions of that outcome. Indeed, if you could ask branch banking for its take, it would probably say “the reports of my death have been greatly exaggerated.”
The overriding point is that most innovations in banking are incremental not radical. ATMs didn’t destroy branch banking and neither will mobile banking. New channels don’t replace old channels, they supplement them. Branches are incredibly expensive to operate. They are not the optimum channel for every banking transaction. However, branches do provide a unique value to consumers and as long as that is true, I don’t see mobile being any more successful in eliminating branches than Mailway was.