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The local bank branch may have more relevance than people think.
A new study by the fintech company Kasasa showed that 56 percent of respondents said the main reason they do not open a checking account with a local financial institution is due to limited branch and ATM locations.
The December 2018 study was conducted online by The Harris Poll and garnered responses from more than 2,000 adults in the U.S. age 18 and older.
The study also found that a lack of up-to-date technology is another deterrent for opening an account at a local financial institution, with 22 percent of those who would not consider going local for checking accounts citing this as a factor.
Modern technology appears to be most important to Millennials, with 28 percent of Millennials who wouldn’t open a checking account with a local institution citing lack of modern technology, compared to 18 percent of Generation X and 14 percent of Baby Boomers.
Concern over inferior product offerings are the third most common reason for not selecting a local financial institution for checking account needs at 21 percent. In fact, 51 percent of Americans believe local financial institutions do not have the resources to offer the level of innovative, user-friendly products that large national banks or online-only banks do.
“The idea that community financial institutions don’t offer the same products as megabanks is just not true,” Kasasa CEO Gabe Krajicek said in a statement. “Kasasa was created to help community banks and credit unions compete aggressively with megabanks by offering products that are innovative, convenient and free to consumers. Local financial institutions must use their combined voice to make it known that they are offering similar, if not better, products than megabanks. This is how we will take back banking.”
While this study reveals the primary hesitations consumers have with choosing a local community bank or credit union, most also said they prefer them over large national banks, with 55 percent of respondents saying they would consider a local financial institution to open a new checking account compared to 29 percent who would consider a large national banks.
