How community banks are leading the way with innovation

Find out why innovative community banks are the still at the heart of the US banking sector.

Community banks are an integral part of the US banking system. These smaller, locally-based financial institutions offer consumers an alternative to the major nationwide providers.  In the US, a community bank is typically defined as one with assets of less than $1 billion – and for many people a local credit union or community bank is often the first choice when opting for a financial services provider.

Why people opt for community banks

The key as to why community banks are so popular is right there in the name – they are part of the local community. Often owned and operated solely within a state or even just a few neighborhoods, these banks offer a personal touch that the bigger banks are currently looking to replicate.

With employees residing in the same communities as customers, this gives them a vital insight into the unique needs of their users. If an individual wants to get a loan from a major bank based on Wall Street, for instance, their application is likely to be approved by a loan officer who will have no idea about who they are or what their needs may be.

Such is the importance of customer service, personalization and convenience to the public and small businesses these financial institutions serve, the role of the ATM is also very important. Credit unions and community banks therefore can often be some of the earliest adopters of new cutting edge self-service technology.

How community banks are innovating

Community banks are an essential part of many US neighborhoods, supporting local businesses and citizens and reinvesting money into the area.

These financial institutions have proven to be adept at embracing new technology platforms. These are used to support new methods of payments, as well as take advantage of improved security standards to protect small business owners and customers from hackers and other criminals.

Community banks recognize the importance of the personal touch, and this is reflected in the solutions they are choosing to deploy. For example, we at NCR have seen significant interest from these banks in the new SelfServ 80 Series ATMs Interactive Teller (often referred to as ITM) as well as Interactive Services.

More than 40 percent of the ATMs we ship to these financial institutions are enabled for cash and check deposits. This is particularly important as automated deposits now account for around 25 percent of the entire US ATM functionality, so it’s not something any forward-thinking bank can afford to be without.

Why does all this matter? For many Americans, community banks are their primary, if not only, connection to the financial services industry. And in a changing environment where there is more competition than ever and technology such as automation is becoming more and more expected by consumers, being able to deliver these services is essential.

That’s why it’s great to see so many community banks getting on board with the latest technology. For example, more than 90 small financial institutions have already opted to invest in NCR’s latest SelfServ 80 Series since it launched in February 2017.

With the total value of cash withdrawn from ATMs in the US standing at $687 billion, according to figures from RBR Global ATM Market and Forecasts to 2020, the importance of having the latest technology in these devices is clear, and it seems that community banks are leading the way with this. Long may it continue.

Written by Colin Gordon

Colin Gordon

Colin Gordon is a Global ATM Marketing Manager based at NCR’s R&D Center in Dundee, Scotland. Colin is responsible for the marketing of NCR’s financial hardware portfolio with a specific focus on activities such as demand generation, sales enablement, market analysis and customer engagements for the ATM business.

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