Should Banks and Credit Unions Reinvent Their Call Centers?

Distributed call centers inside branches, instead of centralized phone banks, may be the way of the future.

Banks are thinking hard these days about how to deploy modern technology within physical branches — part of an overdue effort to fuse the online banking experience with the in-branch services, both of which are important to consumers when choosing a bank, according to multiple surveys.

But what about the humble contact center? Could it, too, be in for a transformation? It certainly looks possible.

Banks and credit unions began using phone-based contact centers in the early 1980s as part of a cost-reduction strategy. The idea was to move “low-value transactions” out of high-touch branches and into centralized locations where they could be handled remotely.

But banks found that contact centers did not reduce overall operating costs. Rather, as the management consultant Strategy& explains, they “had simply created yet another channel that required ongoing cost management.”

Yet bank contact centers haven’t changed much since. Employees still typically work at phone banks in single, centralized locations, equipped with computers and headsets, and they continue to interact with bank customers only remotely— never in person, and never in a branch.

That might be changing.

As banks and credit unions both reduce the numbers of branches they operate and reinvent the ones that remain, the opportunity is presenting itself to shift from centralized to distributed call centers — that is, to move employees away from phone banks and into branches where they can handle customer service tasks both on the phone and in person

Technology is making this more possible than ever. Brands like Cisco, Avaya, Mitel, Ring Central and others offer advanced contact center solutions that enable employees to manage their call center responsibilities without being colocated in a single setting.

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Do Banks Need Traditional Call Centers?

Contact center interactions are vitally important to banks: While they constitute less than 10 percent of customer interactions at most banks, according to research by the consulting firm Bain, they account for more than 30 percent of what Bain calls “moment-of-truth encounters,” those that “have higher emotional stakes for the customers, such as calling to report a stolen credit card.”

And traditional bank call centers are not performing well: When 115,000 banking customers were asked in a Bain survey to evaluate their experiences interacting with their bank through various channels, they ranked contact centers last.

Given the high stakes of such interactions, it makes sense that banks and credit unions would look for ways to integrate call center staff more thoroughly with the institutions and their customers. At the same time, cross-training employees to handle both call center and in-branch interactions offers banks and credit unions a number of advantages, from staffing flexibility to improved customer service to lower costs.

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Cross-Training Staff Offers Banks Numerous Advantages

Bain’s Nikola Glusac and Corrie Carrigan envision banks employing better-trained call center employees to focus on providing more complex services, like loan consultations, as more consumers shift to digital apps for basic services. In fact, they say banks are “rethinking their sourcing and location strategies” for call centers, “to ensure they’re able to tap into skilled labor pools.”

At the same time, banks and credit unions are rethinking the way they staff branches generally. For example, when iQ Credit Union opened a new flagship branch in Vancouver, Wash., in December 2017, it decided that all employees working there would be trained to help customers with anything they needed.

“They can start the member with a teller transaction and invite them into an office for a more in-depth loan discussion,” Danette LaChappelle, iQ’s senior vice president of marketing, told Credit Union Times. “There is no need to hand them off to someone else. That is what helps to deepen the relationships.”

Given these converging trends — the modernization of the bank branch, banks’ need to reduce operating costs while meeting customer demands and the increased cross-training of staff — it makes sense that a rethinking is in order for call centers to be next in line for digital transformation. The technology exists today to make it happen.

This article is part of BizTech's EquITy blog series. Please join the discussion on Twitter by using the #FinanceTech hashtag.

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Dean Mitchell/Getty Images
Mar 18 2019

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