When the online revolution launched more than 30 years ago, banking went through a seismic change. First, customers were now able to do things like check their account balance or transfer funds without actually visiting a branch. Banks have since gone all-in on the technology revolution, embracing advances like online banking, mobile banking, virtual assistants and more. Representatives from a variety of institutions described their digital journey for NJBIZ and discussed how the landscape will continue to evolve.

“It’s not unusual for people to look at banking as an ‘either-or’ experience – either digital or in-person – but in fact many Valley customers use both modes,” according to Valley Bank President, Digital & Retail Banking, Justin Black. “They use a mix of branch and digital. Online and mobile banking offers convenience, and if they’ve got questions they’re welcome to stop in a branch for face-to-face or other advisory services.”

In the past few years, he added, “we’ve refreshed close to 70 branches in New Jersey reducing teller lines to offer more opportunities to sit with a branch associate for financial advice, mortgage, insurance and other services. We continue to leverage human relationships, creating branch space for community activities, such as educational seminars including our ‘Journey to Homeownership,’ where local residents can meet with and get advice from home loan consultants as they navigate the homebuying experience. It’s all about the evolution and expansion of our services.”

And even as many financial institutions trim the number of their brick-and-mortar branches, “We continue to expand our branch locations when it makes sense,” he said. “At the same time, Valley devotes considerable resources to the customer experience across all banking formats, including efforts to ensure that customers’ sensitive data remains safe. As customers increase their engagement with us – at the branch or digitally – we get a better understanding of their behavior and we can reach out if there’s an unusual transaction or other activity. And for business customers that enroll in our fraud prevention services, they can approve or reject ACH (Automated Clearing House, or electronic bank-to-bank payments) and check activity even before it completely clears their accounts.”

Valley is also leveraging advances like artificial intelligence “to develop tools that better assist our associates in providing the best customer service,” said Black. “In addition to those initiatives, we continue to develop and deploy AI-backed fraud detection services.”

Institutions like First Commerce Bank have also adapted to the multiplatform opportunities and challenges of the digital environment.

“First Commerce Bank sees the importance of utilizing various digital avenues to build and maintain customer relationships such as personal online banking, business online banking, cash management systems for businesses, mobile banking, email, and chat capabilities,” noted Gregory Garcia, executive vice president and chief operating officer. “Although we have the technology to make banking more convenient, our core values are to build relationships and help build, serve and educate the community. We have the opportunity to reach more people and build more relationships through services such as our newly added online account opening where customers can open accounts easily and securely while at home or on the go.”

The bank takes other steps to ensure the safety and convenience of customers, he said. “We like to also add an individualized touch with our relationship managers and customer experience team reaching out to new and existing customers, even if they opened their account online. This prevents fraud and gives the customer a chance to ask questions, discuss concerns and build a rapport so they feel comfortable.”

Cybersecurity is a top concern, Garcia noted. “Of course, digital platforms also present challenges in terms of fraud and cybersecurity, so our bank has invested in platforms that perform real-time know-your-customer detection to validate customers through our digital channels, as well as help us prevent check fraud and identity theft,” he explained. “We offer cash management solutions such as positive pay and positive payee that helps to detect check and ACH fraud. However, the thing that makes a community bank part of the community is that we have people, relationship managers, who know their customer and are looking at suspicious activity and helping to make decisions; looking at things to help the customer grow and helping to protect them and the bank.”

Hometown feel

But even as the bank embraces digital solutions, it remains committed to brick-and-mortar banking, according to First Commerce Senior Vice President, Chief Experience Officer Jill Ross. “The more branches we have, the more involved in the community we can be,” she reasoned.

“It is important to us to maintain that hometown community bank experience while expanding our market presence, continuing to provide advanced technology solutions and top tier customer service. It is this mindset that has driven us to offer even more capabilities for both consumer and business banking customers such as merchant services, digital account opening and expanded services such as financial education programs online and at our local schools.”

First Commerce has “a unique branch network that is concentrated in northern New Jersey, with branches in Bergen and Essex counties and central/southern New Jersey with branches in Monmouth, Ocean and Burlington counties,” she detailed. “With the significant decline in community banks headquartered in New Jersey, we are strategically looking to open more full-service brick and mortar locations to both fill in the branch network gap mentioned above as well as expand our market presence to southern New Jersey and other areas that we feel are in need of a community bank to help them meet their financial goals.”

The commitment to branches involves significant upgrades that reflect technological and other advances, she added. “With our Jackson Branch opening in September 2023, we introduced a redesigned concept that makes banking as seamless as possible,” said Ross. “We have stepped away from the separation between a teller line and a Customer Service Representative, for a more personal, convenient way of banking for customers. We’ve also trained and developed a multiskilled, more knowledgeable retail staff, so one person can open an account, deposit a check or solve customer problems across all channels and products. We have also brought in technology that will speed up cash transactions and allow our staff to have conversations with our customers to better help them meet their financial needs. In the future, we will continue to move our branches into financial solution centers than transaction centers. “

The merger of face-to-face banking with technology delivers a win for everyone, observed Garcia. “Our digital banking tools streamline the functions of banking — so we see online and mobile services as a modern way to help ensure customer satisfaction and engagement,” he said.

Online oversight

In January, New Jersey Attorney General Matthew Platkin spearheaded a multistate coalition of attorneys general in support of a proposed federal rule that would increase oversight of digital payment services. Click here to read more.

“The key is to provide a variety of these digital elements together with improved and enhanced physical facilities and well-trained retail staff for the best experience. We are dedicating more staffing resources to a digital customer service model that can provide our customers with the help they need on a personal level while simultaneously using digital tools outside our physical locations. In addition, we are doubling down on relationship management outside the branches, with our relationship managers meeting customers at their place of business.”

Institutions like Bank of America have also embraced new digital formats. “Our clients unlocked convenience 23 billion times last year through digital interactions,” said Nikki Katz, head of digital at BofA. “Individualized real-time alerts and proactive insights, along with our digital platform overall, help simplify the day-to-day management of finances. This allows our clients to more easily balance life and enjoy the moments that matter.”

Bank of America clients are more frequently connecting with their finances digitally. “In 2023, Bank of America clients connected with their finances more than 23.4 billion times through a combination of digital logins and proactive alerts — an 11% increase year over year and all-time record,” the bank announced in February. “Clients received more than 10.6 billion proactive digital alerts in 2023 – an increase of 12% year over year – giving them real-time insight into their financial lives. Bank of America now has 57 million verified digital users, among which more than 35 million have opted to receive these alerts. The most common alerts last year offered insights into account balances, deposit available balances, and virtual debit card usage.”

Also, some 77% of the institution’s consumer and small business customers “actively use Bank of America’s digital platforms, as well as 84% of Wealth Management households, and 75% of business clients,” BofA announced. “In 2023, clients interacted 673 million times with Erica, the institution’s widely available virtual financial assistant. “This was a 28% increase year over year, bringing the total interactions since launch to nearly 1.9 billion.”

A new approach

Some bankers see financial technology companies and other less-regulated competitors as a potential opportunity, instead of a threat.

“We see fintechs as a partner and not a specific threat,” said Garcia. “By partnering with fintechs, we can reach a common goal of getting the best user experience and workflow efficiencies while continuing to provide a regulated platform for our customers so they can feel safe and secure with how their finances and digital identity is being managed. They are only a threat if we ignore implementation of technology within our institution and allow them to create a better experience for our customers.”

He’s a bit cooler on cryptocurrency, however. “We don’t currently believe cryptocurrency creates a significant opportunity for our institution,” Garcia said.

“However, blockchain technology, if properly implemented and regulated, can be a game changer for the banking industry. Unfortunately, that opportunity is not on our top priority list at this time. … We are constantly keeping track of new digital channels like these, that would enhance our product offerings and benefit our customers. We are consistently working to offer the best products and services available for every level of banking and are happy to entertain emerging new products when they fit the needs of our customers.”

Valley Bank also sees value in the fintech segment, according to COO Russ Barrett. “We consider fintechs a key component of our digital strategy and an important driver of innovation at the bank. Through our Valley Venture arm, we not only invest in fintechs, but also have an active gateway to the emerging technology landscape.”