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Does your financial institution realize that convenience can be mission critical?

A big chunk of today’s consumers do nearly everything digitally. The response to COVID-19, where most of the world shut down, boosted mobile and digital services adoption far beyond where it sat in 2019.

Consumers who would have gladly continued shopping in physical stores and stopped at their preferred financial institution branch were forced to find other ways to do what needed to be done. They turned to online and mobile banking in droves.

And some institutions saw the sudden drop in branch banking as an opportunity to save some money. But, while branch closures might create immediate bottom-line benefits, it might not be the best strategy for the long-term.


Wave2 Locator Geo Location Data can help with branch closures and strategically increasing convenience.

Branch closures weren’t a knee-jerk pandemic response

The majority of activity that happens in a branch is not revenue generating, notes Steven Reider, president of Bancography, a consulting firm that advises banks on branch locations.

Federal regulations cracking down on overdraft fees and other operational charges were a good move for consumers. But they cut heavily into the revenues that helped many financial institutions fund the operations of their branch locations.

Moving away from the fees became essential for being competitive in the marketplace. But it also eliminated one of the only ways a financial institution could combat rising building fees, operational expenses, and other increasing costs.

Combined with the sudden labor shortage and significant drops in foot traffic presented by the events of 2020 and 2021, it was a perfect storm. Institutions that were already struggling to keep their doors open were forced to enter mergers or shut their doors permanently.

Larger commercial banks faced pressure from their boards to cut underperforming locations in favor of the new, digital world.

Branches are about more than money

It’s not uncommon to build relationships with specific locations. Recent studies show everyday places gain emotional investment and become a part of a person’s identity and sense of self. And eliminating a place to which someone has become connected can create a significant rift.

So, it’s hardly surprising to learn that thirty-one percent of people who switched financial institutions report doing so because their preferred branch closed. People with greater freedom to migrate their finances are even more likely (35%) to switch institutions when inconvenienced by a branch closure.

But sometimes closing a single branch loses more than a few customers. It loses entire communities.

Rural areas disproportionately affected by branch closures

It is important to remember that a big chunk of mobile banking adoptions during 2020 were out of necessity rather than a desire to stop visiting the branch. A 2021 FDIC survey found eighty-three percent of consumers worked with a financial institution employee or a teller in 2019. Even post-pandemic, percentages of teller banking only dropped around six percent.

Over half of “mobile-only” consumers have visited a branch in the last year, some as often as once per week or more. Over thirty-five percent stated they would visit a branch more often if there were extended hours of operation.

In rural communities, branch visits are consistently higher than elsewhere often because local branches are a part of the social landscape of the area. Located in areas where mobile and digital access is spotty or non-existent, the branch is often one of the only ways to access financial services. And these rural areas are often served by a single branch location or financial institution – where a single branch closure creates an unprecedented impact on the entire community.

Yet, despite the lynchpin position within the area, low population and business numbers make it hard for rural branches to make the cut when it comes to providing the kind of revenues that will keep doors open.

These rural customers might move their business to a financial institution in the next town if it’s available. But that location, whether due to geography or spite, is unlikely to be the same bank or credit union they were with before.

More data can lead to better branch and relationship decisions

Solutions like the Wave 2 branch and ATM locator help supplement visitor data with an additional layer of information on where account holders are searching for financial access. With customizable search features like hours of operation, ATM, ITM, deposits, night drop, and more it is easier for banks and credit unions to see what types of services are needed to continue meeting the needs of account holders and communities.

This information can also be used to segment target audiences for specific messages in the event of unavoidable branch closures or ATM removals. And the locator itself acts as an important notification tool – keeping account holders up to date with timelines and the nearest locations to offer uninterrupted, ongoing, and convenient service.


When it comes to account holder retention and satisfaction, branch closures are rarely a satisfactory cost-saving solution. But there are ways to help weigh important information and leverage communication tools to help make better branch decisions and mitigate damage in the worst-case scenario. And the Wave2 Branch and ATM locator is a key partner in the process. Contact us today!

Wave2 Contact:
Jason Green, Co-Founder
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