Banks, credit unions: Digital surge likely to continue beyond pandemic

Mobile banking was on the rise before the pandemic — now, it’s more popular than ever.

Mobile banking was on the rise before the pandemic — now, it’s more popular than ever. Photo: Adobe Stock

The next time you make a deposit, transfer funds or check your balances, chances are you won’t be standing in a line.

Odds are you’ll be sitting on your couch and thumbing through your smartphone — online.

Now more than ever, as the age of social distancing, working from home and homeschooling children evolves, Americans young and old are flocking to online and mobile banking en masse.

In April 2020 alone, banks reported a 200% surge in new mobile banking registrations and 85% rise in mobile banking traffic, according to an analysis by Fidelity National Information Services.

That jump accompanied a 50% drop in branch foot traffic in the same month, according to U.S. banking data firm Novantas.

The online-banking trend continued throughout the year and into 2021, and Northern Nevada is no exception.

Plumas Bank, which has locations in Northern Nevada and Northern California, saw its overall volume of online banking transactions surge 240% in 2020 compared to 2019, said Sarena Barker, senior vice president of electronic banking at Plumas Bank.

That dramatic digital shift, Barker said, also included a 240% growth in online activity by Plumas Bank’s business clients.

“The factors that contribute to the giant increase were largely driven by the requests for people to stay home,” Barker told the NNBW last week. “What I also think created that increase was people needing to have more access to their funds, and really being able to see what was going on without having to come into one of our bank locations.”

Much of the digital demand, naturally, has been associated with federal stimulus checks doled out in 2020 by the federal government.

People who checked their balance once a week suddenly started logging in multiple times a day. As such, Barker said Plumas Bank saw its online banking activity jump the most last April and December, the main months when both rounds of checks were distributed.

And keeping up with the demand wasn’t easy. Barker said the spike in online usage and enrollment required Plumas Bank’s back-office team to “roll up their sleeves and work some extra hours.”

“Monitoring that activity for risk management was a little bit of a challenge, initially,” she continued. “But once things smoothed out and we recognized what we were really in for, it evened out quite a bit and we were able to meet that challenge.”

Nevada State Bank has seen its adoption rate of online banking grow as well over the past year, said Rick Thomas, executive vice president and Northern Nevada executive at NSB.

When comparing the first four months of the pandemic to the four months preceding COVID, NSB saw its online enrollments increase by 47% for consumers and 102% for businesses, Thomas said.

“The pandemic is really accelerating a trend that’s been developing for a while,” Thomas continued. “It made technology a necessity. Even though banking was an essential business, the lockdowns limited lobby access for nearly 10 weeks, so we encouraged online transactions.

“Many consumers and businesses embrace the ease of technology, and they’ll likely continue to use it as a preferred option going forward.”

He’s not kidding. A survey by Novantas found only 40% of respondents expect to return to bank branches post-COVID. Further, eight in 10 Americans say they prefer online banking to visiting a branch, according to ConsumerAffairs.

Steve O’Donnell, executive vice president and CFO of One Nevada Credit Union, said the financial institution has noticed that trend more than ever.

“I think the whole pandemic has really sped up the adoption of online banking by a few years as users are becoming more comfortable using it now that they’re kind of forced to,” O’Donnell said. “I think the adoption is going to be more of the norm, and you’re going to see a decline in those other types of transactions.”

To that end, O’Donnell said 75% of One Nevada Credit Union’s membership is signed up for digital banking and using it consistently. Moreover, upwards of 60% of its clients have not stepped foot in a branch in more than a year, he added.

“For years, we’ve said that, more often than not, our branches are a billboard for the institution,” O’Donnell said. “People want to know you have a branch close by and it makes them feel safe, but they typically don’t use it.”

One Nevada Credit Union’s customer surveys often clearly spell that out, he added with a laugh.

“We’ve seen surveys where the first question is, ‘How important is it to have a branch nearby?’ And they say, ‘extremely important,’” O’Donnell said. “And the next question is, ‘will you use that branch if it’s nearby?’ And they say, ‘probably not.’”


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