Banks shouldn't abandon branches for mobile services, study finds

Digital banking might be the way of the future, but banks can't neglect their branches, which remain just as popular among younger people as older generations, according to a survey released Thursday by J.D. Power.

The annual survey of more than 80,000 banking customers found that people 20 and younger used mobile services more than people in their 30s and 40s, but that branch usage was the same among the generations. More than 7 in 10 people surveyed in each group said they visited a branch in the past year.

The findings underscore the challenges that banks face in bridging the digital and physical worlds. Customers expect increasingly robust mobile services even as they appear to want to have a personal connection with the bank, said J.D. Power's Jim Miller, senior director of banking at the California-based consumer research organization and subsidiary of McGraw Hill Financial.

“You need to invest and pay attention to digital, but don't forget about the in-person aspect,” Miller said.

Banks such as PNC have been overhauling their branch networks to be more tech savvy and invest more heavily in mobile products.

Some of the largest banks in Pittsburgh — PNC, Citizens, Huntington and First National Bank of Pennsylvania — scored above average on overall satisfaction in the Mid-Atlantic region, as consumer satisfaction with banks generally increased.

The top bank in the Mid-Atlantic was Lancaster County-based Susquehanna Bank, which scored 834 points out of 1,000. PNC's score declined 4 points from last year, though it remained in the top 10 with a score of 798. Citizens Bank improved 17 points to 794, which tied it with Huntington. First National was close behind with a score of 792. All were above the region's average of 785.

First Niagara Bank was below average with a score of 782.

PNC spokeswoman Marcey Zwiebel declined to comment on the survey but said the bank sought to improve customers' experience by transforming its branch network and introducing new digital products.

“Our goal is to deliver what our customers want — when, where and how they choose — when it comes to service, technology and space,” she said. “This includes making major investments in the customer experience across all channels.”

Customers are demanding increasingly sophisticated mobile services and challenging banks to meet their high expectations, Miller said. Customer satisfaction with mobile banking declined for the first time since J.D. Power began tracking it in 2012. The proportion of customers who said they completely understand mobile fell to 47 percent in 2015, from 57 percent last year.

Banks must develop elegant and easy-to-understand technology even as the products become more complex, Miller said.

“Certainly, banks need to pay attention to digital and make sure that they continue to add features that customers really want but make sure the device is easy to use,” he said.