July 31, 2014

Banks Targeting Underbanked

Survey: Banks targeting underbanked

By Allison Ross· Bankrate.com
Thursday, July 31, 2014
 

Hoping to grab more business, a rising number of bankers are turning to the unbanked and underbanked as opportunities for growth, according to a new survey.

The KPMG Banking Outlook Survey, released Monday, surveyed 100 senior bank executives. It found that 23 percent see underbanked consumers as the greatest growth opportunity, a jump from the 12 percent who said that last year.

In addition, 13 percent said they are looking to the unbanked, up from 5 percent last year.

“The nontraditional competitors, such as retailers, have already started gaining market share from this market segment,” the survey notes.

Surveys in recent years have shown that banks could do more for the underbanked and unbanked segment of the population.

Growing bank branches?

The survey also found that bank branches are far from passe in the eyes of many bankers.

While some have predicted the demise of bank branches as new technology diminishes the need to drive to a bank branch, 41 percent of survey respondents say they plan to increase the number of branches over the next 12 to 18 months.

“While online and mobile technologies provide customers with convenience, branches offer the personal interaction that some consumers prefer,” Judd Caplain of KPMG said in a release. “However, the new branches will be different from those of the past, with reduced size, enhanced technology capabilities, virtual customer service interactions, universal tellers, and an overall increased focus on the customer.”

A Bankrate survey found recently that half of all bank or credit union customers had visited their local branch within the past 30 days for reasons other than the ATM, so clearly bank branches still have a place.

What do you think of banks’ push to reach out to the underbanked?

Follow me on twitter: @allisonsross.

Read more: http://www.bankrate.com/financing/banking/survey-banks-targeting-underbanked/#ixzz39XX3PY6n
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Editors Note: Why not offer BANCwire to reach out to those individuals that may not have a financial institution home, or are seeking services their current financial institution does not offer.

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