The wide-scale adoption of digital and mobile channels has curtailed foot traffic in many credit union branches, but one age group is walking through the doors more than ever: the millennials.
Among its recent research on branch usage, Fiserv found that millennials are not only using branches more frequently than all other generations today, but they also say they will do so more often post-COVID than they did prior to the pandemic.
"It really surprised us," said Bill Handel, chief economist for Fiserv. "This is not a one-time study. We've repeated this study again and again and again. And we get the same results."
Speaking at the Credit Uni\on National Association's
"In an uncertain world they want somebody that they're going to be able to talk to who they can trust. That's what they're really looking for. They want to make sure they're making the right types of decisions," Handel said.
Navy Federal Credit Union in Vienna, Virginia, added 18 new locations over the past two years, largely due to demand across all age groups, said Keith Hoskins, the executive vice president of branch operations for the $156.6 billion-asset credit union.
More than 21 million members visited a Navy Federal branch over the course of 2022 — an increase of 1.4 million from the previous year, Hoskins said. It now has 355 branches altogether.
"If you think about some of our younger members that may need help with a budget [or] may need help in terms of how to save to buy that first home for their family, the earlier we can engage with them … the better off we think they will be ... coming into our branches and having those deep relational conversations," Hoskins said. "Our investment in our growing branch network, it's needed for our members and we believe that great service makes great business."
Many credit unions have
Credit union branch growth is so strong, the trend has run counter to the number of credit unions in business. Total credit unions in the U.S. shrunk by 30% in the past 10 years, yet the total industry branch count has increased by 2%, according to Handel.
"The reason is because of the recognition that we cannot really truly grow effectively in a marketplace without having a branch network," Handel said. "It's just very, very difficult to do that."
Members 1st Federal Credit Union in Enola, Pennsylvania, is seeing an uptick in its millennial members visiting branches. It has to do with millennials seeking guidance and consultative advice about the best strategies to achieve their goals, said Michael Wilson, chief experience officer for Members 1st.
"This is not just on the consumer side, but also on the young entrepreneur side as we help them start and grow their businesses. Financial literacy has become critically important to us for that very reason," Wilson said in an interview.
The $7 billion-asset credit union has 60 branches including five it added last year as part of an expansion into Berks and Lehigh counties.
And Members 1st is not done building. Wilson said the credit union could add five more branches in those two counties, and it is evaluating its options of moving into other contiguous markets in the next couple of years.
Glenn Grau, senior vice president of sales for the Pittsburgh-based branch design company PWCampbell, said the firm's clients agree with Fiserv that it is hard to gain market share without a physical presence.
However, branch usage has certainly changed, with many transactions moving to mobile, Grau said. But he has seen younger credit union members walking into a branch to get a problem rectified or to get information.
"They may not come in all the time, but they want to know that you're there," Grau said. "They don't want to call an 800 number or chat online."
And while Grau said PWCampbell is not building as many new branches as it was a decade ago, construction goes on. What has dried up instead, are the discussions about the eventual death of brick and mortar, Grau said. "Branches aren't going away."
