Banks are having trouble getting millennials to come into traditional bank branches. The solution? Bring bank branches to the millennials.
Led by Capital One, financial institutions are experimenting with transforming traditional bank branches into high-tech coworking cafes. By creating spaces young professionals want to come to — and by outfitting those spaces with free Wi-Fi and smart displays loaded with financial information, and staffing them with both baristas and financial coaches — banks are hoping to capture an important demographic and avoid losing customers to online-only financial institutions.
The reasoning makes sense. According to a Gallup poll, only 66 percent of millennials visited a bank branch in the past six months; another survey shows 73 percent of millennials would be more excited by a new financial offering from a tech company such as Google or Apple than one from their nationwide bank.
But to deliver on their promise, banking cafes must be inviting, exciting spaces equipped with the right mix of technology and services.
Millennials May Find Appeal in a Coworking Space
The idea of a banking cafe goes far beyond coffee. Future Branches calls the Capital One Café an effort to “market a relationship-based banking experience to millennials in a manner that speaks to them and their needs.”
The cafes serve Peet’s Coffee, tea and locally baked pastries (a nod to millennials’ expressed desires to support local businesses in their communities). Free Wi-Fi and copious power outlets encourage people to pull up a chair, whip out their laptops and get some work done. And, although the cafes are open to anyone, Capital One cardholders get 50 percent off Peet’s beverages.
Capital One customers also get access to no-fee ATMs where they can get cash, make deposits or pay their credit card bills. In addition to these routine banking services, the cafes have “ambassadors” (rather than tellers) who can answer questions about Capital One accounts and cafe events, as well as certified life coaches who are available for one-on-one appointments to discuss financial goals.
In perhaps the most creative attempt to draw people in, the cafes have community rooms that can be reserved online by registered nonprofit, alumni and student groups.
“By scratching the sales pitch and instead offering valuable perks like free Wi-Fi, a nice co-working space, local coffee and food, and complimentary money coaching, [Capital One] may have young professionals who aren’t already with the bank asking, ‘Why not sign up?’” Business Insider notes.
Other banks have also gotten in on the action. For example, Barcelona-based CaixaBank opened imaginCafé, a destination meant to offer “culture, fun, technology, youth — all in the same place.”
Reimagined Banking Branches Lean Heavily on Tech
Fast-and-free Wi-Fi is the table stake for any cafe, of course, and banking cafes are no exception. Any financial institution that is encouraging people to use their branch locations as coworking spaces must ensure that Wi-Fi is reliable, secure and as fast as possible. And people might stay longer if there’s ample opportunity to charge their devices.
Beyond those basics, banks really have a lot of freedom to play with technology in ways that they think might convert their cafe patrons into banking customers. For instance, Capital One Cafés have a “Demo Bar” where customers can learn things like how to pay their bills using voice-activated smart speakers. The cafes also have Apple iPad devices that allow customers to click through short finance lessons or take a quiz to test their money knowledge.
“Technology, of course, is the staple diet of the millennial generation, into which more than 80 million people in the US have been born,” Future Branches states. “And this is why it should come as no surprise that millennials are largely rejecting the traditional banking experience that previous generations have embraced for so long.”