Do You Still Go To A Bank?

Are Banks a Thing of the Past? Do people use banks anymore?

What adjustments would you have to make to your business, if physical banks closed their doors today?

A large amount of people today no longer carry cash or write personal checks when making a purchase.  Whether we’re using a credit/debit card or processing a payment online, the need to visit a physical bank is starting to dwindle.

We see it in Science Fiction movies all the time, a society that revolves around some sort of virtual or credit-like currency.  Sometimes these characters use a little card or bio-metric (thumbprints) readings to make purchases.

The FDIC (Federal Deposit Insurance Corporation) which insures banks and their depositors, has statistics on their website that they update pretty frequently.

As of May 8th, 2014 – The FDIC website reports that there are currently 6,728 FDIC-Insured Institutions.  From January 1st of this year, until May 8th, they have reported that 94 institutions are gone due to closings or mergers.  In a little more than 4 months, 1% of the banks that we had at the start of the year, are no longer around.

Last December, CBS news’ Money Watch put out an article about this; reporting that the number of FDIC Insured institutions fell to 6,891 at the end of September 2013.  They cited that many of the closed institutions are small banks, struggling to keep up with the policy changes, economic hardships, and increased workload due to changes in security requirements.

So this means, in 6 months, we’ve lost 163 financial institutions.  I have a feeling that number will continue to drop.  The need to visit a physical banking location is becoming less and less.

The biggest source of money transactions are typically businesses – but we very rarely ever deal in direct cash (unless you have a consumer based business of course – restaurant, retail, etc.)  There are not many business needs that require an employee to physically be in the bank.

If the physical paper money system eventually disappeared, I think that would be the end of physical banks.

What would have to change in your business if physical banks no longer existed – leave a comment and let us know.

 

2 Comments

  1. I only enter a branch if they’ve not yet incorporated an ATM that
    accepts cash deposits for immediate availability or to replace a lost
    ATM card… otherwise most banks/financial institutions websites are
    developed enough to transfer funds, bill pay etc. thus eliminating a
    need to go inside. Between an ATM and their website, my banking needs
    are typically covered there. The convenience of online banking is a
    luxury that everyone should enjoy!

    Reply
  2. We are seeing a reduction in bank branches in rural areas,” says Bert Ely, a consultant to the banking industry and founder of Ely Co. Inc.

    Reply

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