Brick and Mortar Banks
When deciding between an online-only bank and a bank with physical branches (often called a “brick and mortar bank”), it’s important to weigh the pros and cons. Online banks have lower overhead costs, which allows them to attract customers with higher interest rates and lower fees. However, online banks often lack the personal touch and instant access to certain services that a local, brick-and-mortar bank offers.
“Local branches often provide customers with a sense of security,” says David Chen, director of finance at Relyir, “and having a physical location to visit provides the kind of personal attention, direct service and immediate problem resolution that online platforms can’t guarantee.”
Brick-and-mortar banks allow customers to interact directly with bankers, making it easier to resolve issues and ask questions in real time. Additionally, local banks often have connections to their communities and offer services tailored to local needs. Meanwhile, online banks typically offer robust mobile and online banking platforms that appeal to people who prioritize digital convenience over face-to-face interactions.
Here are three reasons why having a bank branch near you is worth considering.
1. Face-to-face service
One advantage of a local bank with a brick-and-mortar presence is access to a variety of in-person services. These services are important for customers who need to handle certain banking tasks that can’t be easily accommodated by an online-only bank.
For example, local banks often offer safe deposit boxes where customers can store valuables and important documents. This service is important for people who need to safely store items like birth certificates, real estate deeds, and family heirlooms.
Another important feature is the notary service, available at some local bank branches. Notaries help certify documents, providing a vital service for legal documents such as real estate transactions and loan agreements.
Additionally, customers who need to deposit large amounts of cash or checks benefit from having a local branch. Online banks may allow mobile deposits, but they often have limitations on the amount you can deposit. Local banks can process large deposits quickly and efficiently, making funds available immediately.
“If I have a problem with my account, I can go into a branch and speak to a representative directly,” says pharmacist Mena Bowles. “They understand my business and my financial situation, so they can provide the right products and services to meet my needs, like a competitive business credit card or line of credit.”
Among short-term savers who don’t have an online savings or money market account, 45% said it’s because access to a local branch is a priority, according to Bankrate’s latest Online Savings Survey.
2. Cash and foreign currency
Access to cash is another benefit of having a local bank branch. While online banks rely on ATM networks to provide cash, local banks usually offer more direct and immediate cash withdrawals without the potential fees associated with out-of-network ATMs.
“My employees and I frequently visit our local bank branch to deposit checks from customers or to withdraw cash for jobs that need doing,” says Joe Gerriall, owner of the family-owned business, Gerriall Masonry & Landscape Construction.
Additionally, local banks often have extensive foreign currency exchange services. Whether you are traveling abroad or returning home, having a local branch will allow you to exchange money conveniently and at a better rate than airport kiosks or currency exchange offices. This service is beneficial for travelers who need to exchange currency frequently.
3. Relationship and community building
The benefit of a local bank is the opportunity to build relationships with the staff. Regular visits to the branch create strong connections with financial advisors, tellers, and other bank employees.
“Brick-and-mortar branches act as community centers, where we can foster personal relationships, get to know local businesses personally and support local businesses by providing financial advice tailored to their needs,” Chen says. “This element integrates the branch into the community fabric, benefiting both consumers and businesses.”
Local banks frequently engage in community-building activities, such as sponsoring local events and hosting financial education workshops. Customers who bank locally are part of a broader community network.
Gerriol wholeheartedly agrees: He appreciates the personal touch that a local bank provides.
“The tellers know our names and handle our transactions efficiently,” Gerriault told Bankrate. “If we have a problem, we can go to the bank and speak to someone in person. This level of customer service gives us peace of mind that our money is in good hands,” he added.
Conclusion
Local banks remain an important part of the financial industry, offering a range of in-person services that online-only banks can’t match. From opening a current account or safe deposit box to personalized advice, local banks offer value beyond the banking transaction.
