Although online and mobile banking have seen a phenomenal rise, physical branches continue to remain prevalent, according to a research from the Federal Deposit Insurance Corporation (FDIC).
Branches still continue to remain the primary means through which FDIC-insured institutions provide financial services to their customers.
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The research found that drop in the number of branches in the US over the past few years has been quite modest. FDIC-insured institutions ran 94,725 banking offices as of last June, which is a fall of only 4.8% from the all-time high of 99,550 in 2009.
The last few decades has indeed witnessed a rise in the number of US bank branches, with declines recorded only during the banking crises of the late 1980s and the last few years.
According to the research, four main factors have influenced the number and distribution of banking offices which include population growth, banking crises, legislative changes to branching laws, and technological innovation.
The study further highlighted that inspite of launching various electronic channels for banking services such as ATMs, phone, online and mobile banking since 1970s, the number of banking offices grew almost twice as fast as the US population between 1970 and 2014.
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By GlobalDataMoreover, the density of banking offices per capita as of last year was higher than it had been at any point before 1977.
"In terms of technological change, there is little evidence that the emergence of new electronic channels for delivering banking services has substantially diminished the need for traditional branch offices where banking relationships are built," said FDIC.
New technologies have however adversely affected the number of transactions at branches, and the young customers are now making fewer visits to brick-and-mortar branches.
