The micro-bank branch - the future of banking?

The micro-bank branch - the future of banking?

The little bank branch that could, has.

And it may change the way banks operate their branches in future.

In December 2003, Bank of New Zealand opened the country’s first bank micro-branch in Otorohanga. The branch is barely bigger than a test cricket pitch.

This week the micro-branch passed its first test. The results of a survey, conducted on behalf of Bank of New Zealand, show customers who have been into the micro-branch have given it an approval rating of ‘good / very good’ in its first three months of operation. Bank of New Zealand’s branches complete the survey regularly to keep track of service standards and provide the basis for improvements in service.

The results have excited Blair Vernon, general manager of personal financial services at Bank of New Zealand.

“Customers have given this new approach a pass mark. That’s important because it tells us that customers have looked beyond the novelty factor and rated the micro-branch on its merits.

“It’s a unique solution to a common problem. There’s little use having a branch the size of one of our busiest branches in central Auckland, catering to a much smaller number of customers. We have to be smarter than that.

“We need to move away from the policy of ‘one-size fits all’ that banks have taken with branches. The results of the Otorohanga example will be taken into consideration as we plan changes to our branch network elsewhere in New Zealand.”

Campbell Parker, Bank of New Zealand regional manager for the Waikato, says the new concept of the micro-branch was introduced to Otorohanga because the bank used to have a large two-storey corner site with only two staff running the branch five hours a day, five days a week.

“That didn’t make business sense,” says Mr Parker. “We needed to find an alternative way to maintain our presence in Otorohanga, but in a way that worked for the community and for Bank of New Zealand.

“The micro-branch was the answer.”

Mr Parker says a large part of the success comes down to the support the bank has received from Otorohanga’s town leaders.

“The Mayor of Otorohanga, His Worship Eric Tait, wanted to see Bank of New Zealand stay in Otorohanga. We consulted extensively and worked closely with the council to come up with the micro-branch and to their credit, they really took to the idea,” he says.

The branch’s customer service representative, Marie Liley – who runs the micro-branch - says customers were initially quite cool to the concept.

“Generally customers assume that the bigger the branch the better the service. But that isn’t the case. Good service is being responsive to customers and making people feel welcome. Then they feel comfortable about being your customer. That doesn’t have anything to do with the size of the building.

“Customers are beginning to recognise that, and the results from the survey prove it,” she says.

The branch is situated inside the town’s Information Centre and is open during normal bank hours.

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