Backbytes: Why do banks make it so difficult to do banking in their own branches?

Banks and retailers trying to drive customers to their online channels are undermining their own 'unique selling point' against pureplay online rivals

Once, quite a few years ago, I had the pleasure of having to make an emergency monthly payment on a Cooperative Bank credit card. Brandishing the requisite minimum from an emaciated piggy bank, I made my way to the nearest Cooperative Bank branch, reasoning that would be the quickest way to rectify a parlous financial situation.

Unfortunately, however, the tellers at the empty branch of the Cooperative Bank were adamant that they couldn't possibly take a payment in cash, cheque or World Cup Winner stickers for one of their bank's own products in one of their own branches.

Even more unfortunately, that was illegal: banks are obliged to take payments over the counter, in branch, on products on which customers have (ahem) fallen behind on payments. The staff at that particular branch of the Cooperative Bank therefore had to work out a way to take such a payment, whether they liked it or not.

They couldn't possibly take a payment in cash, cheque or World Cup Winner stickers for one of their bank's own products in one of their own branches

It took them some time - and quite a few phone calls - to do something that ought to have been an easy part of their everyday roles.

But it isn't just the terminally inept Cooperative Bank that seems to have a problem with the very idea of using their branches for the purpose for which they were originally intended; namely, banking.

Want to cancel an overdraft at a branch of the Nationwide? They can't possibly do that. Try the mobile app or online banking instead. And, while Lloyds Bank has finally done away with paying-in slips (more than twenty years after Nationwide did so), it also appears to have largely done away with banking as well.

For some reason, the branches of banks and building societies appear to have been refurbished to look like coffee shops (without the coffee), except with multiple counters - most of which are staffed by people who can't help you.

To top it all, they've also decided to deploy staff as ‘greeters', as if they were another ghastly branch of the Disney Store. Obviously, they can't help you, either - they might be more gainfully employed telling customers to ‘bog off' rather than asking ‘how can I help you?' because they can't.

And if they're not going to provide core banking services in their branches to their own customers, what is the point of operating a large branch network?

The one key advantage a bricks-and-mortar retailer has is the ability to satisfy customers' need for instant gratification

It's the same with retailers.

Leaving aside the debilitating debt left behind by multiple private equity vultures, one of the most depressing aspects of electronics retailer Maplin (RIP) before it folded was finding out that whatever you wanted that was listed on its website wasn't actually held in stock in the branch down the road.

The one key advantage a bricks-and-mortar retailer has is the ability to satisfy customers' need for instant gratification; to satisfy the urgent desire for shiny things right now: not tomorrow or the day after.

Hopefully, Sainsbury's won't make the same mistake with Argos. The catalogue shopping chain might have struggled for growth in recent years, and consolidating outlets within branches of Sainsbury's makes a lot of financial and logistical sense.

However, if the model shifts from click-and-collect to click-and-collect-tomorrow-or-the-next-day-if-you're-lucky because Sainsbury's branches lack the space to stock everything a typical Argos normally stocks, then customers will migrate to rivals who can guarantee next-day delivery to your door (or hedge, front garden etc).

Whether you're a bank or retailer with a branch network it makes sense to use that as far as possible to your advantage

The whole point of a retailer like Argos is that it stocks lots of stuff that you can get your hands on straightaway (and return equally quickly and easily). That is its unique selling point: Amazon does everything else considerably better than Argos.

The bottom line is, whether you're a bank or retailer with a branch network it makes sense to use that as far as possible to your advantage. It's an asset that ought to be sweated.

It may appear advantageous to the CFO to do away with all those costly branches (not helped by high business rates) and expensive staff, and keeping open loss-making outlets makes no sense, but they're also the organisation's unique selling point when it comes to competing against online.

Rather than aggressively trying to drive customers to online channels by running down branch services, maybe it makes sense to drive them to outlets instead, using online and mobile to facilitate that?