Candid-camera bank

6/17/2001

One day last week, Roxanne Brodie faced a video bank teller for the first time. It took Ms. Brodie, who is 41, a few minutes to figure out how to cash a check while talking to a teller on a TV screen at the KeyBank branch at Byrne Road and Hill Avenue. Her 9-year-old stepson Alex came to the rescue.

“He talked me through it,” said Ms. Brodie. Motioning toward Alex and his younger brother, Jacob, 6, she added: “They're more computer-literate than I am.”

A few feet away, William Weaver, an 83-year-old retiree, cashed a check and made a deposit using a video-teller station and a pneumatic tube to ship the paperwork to a teller working behind a solid, windowless wall. “It's quick and easy,” he remarked.

They are among thousands of Toledoans taking part in a pilot program. Key's RemoteTeller System at the Byrne and Hill office is the first full-scale installation for the giant bank that has branches in 13 states and other businesses in 46 states.

Key's pilot program is the latest of many banking-industry attempts to cut personnel costs and scale down “brick-and-mortar” banking through electronics.

A number of large banks nationally have recently cranked up video-banking operations, but most Toledo bankers said their institutions are not venturing in that direction.

Douglas Austin, a local banking consultant, is doubtful the idea will get beyond the testing stage. The president of Austin Financial Services conceded it can work in some places, but he noted that several banks have abandoned the concept. “It doesn't work for most of them because it doesn't have personal service,” he pointed out.

Huntington National Bank introduced video banking with much fanfare in 1994 in Columbus and Dayton, and later opened video kiosks at the University of Toledo's and Bowling Green State University's student unions that that were electronically tied to a central facility in Columbus. It planned to have eight video kiosks in the Toledo area and dozens around the state, but it shut down the kiosks and the project in the late 1990s.

The video kiosks were introduced in the early days of the Internet, said Tom O'Hara, a Huntington senior vice president. The bank ended up with more emphasis on the Internet and automated-teller machines, he said, but still expects a future in video banking.

James Rohrs, a former Huntington executive who once headed the bank's Toledo area operations, recalled customer problems with a kiosk in a Columbus suburb but said he thinks video banking could succeed once a younger generation of consumers gets into the banking system.

“Huntington was too far ahead of its time,” said Mr. Rohrs, now president of First Federal Bank of Defiance. “Huntington tried to convert to automation, but the customer base told us they didn't want it.”

Mark Knierim, a vice president of KeyBank and marketing manager in this area, said Key's remote teller operation, begun in February, allows three to five tellers in the branch to handle transactions from all seven stations, five inside and two in a drive-through. But the main reason for installing the video stations is “we were trying to reduce lines customers see, not reducing the number of tellers,” he said. “Tellers can move customers through faster.”

For the system's first 60 days, the bank had greeters to talk customers through the procedure and now staffs the branch with tellers behind a windowless wall and with two customer-sales and service representatives who work largely on the telephone but can be pressed into service if a customer wants to talk face to face to a person, said Mr. Knierim. The stations are open until 4 p.m. Monday through Thursday, until 6 p.m. Fridays, and until noon Saturdays.

Until a teller begins a conversation with a customer, each video station plays continuous segments of a five-minute update on news, sports, and the stock market as well as the bank's product information.

Customers using the video tellers one day last week seemed favorable.

“I like it,” said Sally Williams, a 69-year-old retiree. “Not better than a teller, but I do like it. A lady had to show me how to do it the first time, but I do it on my own now.”

Teller Michelle Hodge said, “We've had a few customers who didn't want anything to do with it, but not very often.”

Walls between the stations as well as the option to use a telephone handset instead of the microphone provide privacy for customers, Mr. Knierim said.

A secondary benefit, Mr. Knierim said, is that tellers and cash are much more secure, making a bank robbery more difficult. Rhonda Lowe, a teller at the Byrne/Hill branch, said, “I feel much, much safer.” She estimated she has witnessed seven or eight robberies in her career, including two robberies at her own teller station.

The technology is supplied by Diebold, Inc., of North Canton, Ohio, which pioneered ATMs in 1966. “This is a very popular product,” said Joseph Richardson, a spokesman. The company has shipped more than 800 video teller stations to 220 locations around the United States and Latin America.

His firm's clients include big banks such as Chase Manhattan, Bank One, Bank of America, Fleet Boston, and Comerica Bank, as well as many smaller banks and credit unions around the United States and Latin America.

Ed Reiter, senior chairman of Sky Financial Group, Inc., in Bowling Green, is skeptical of the technology's value. “If people like a teller, they like a live teller,” he said. “If they like ATMs, they don't want to talk to a picture screen. It's a big expense for a small gain.”

Mike Farrell, senior vice president of Fifth Third Bank (Northwestern Ohio), said his company has discussed the technology but for now prefers the face-to-face contact by tellers. Lee Dunn, president of Charter One Bank's Toledo division, called the video banking “a bit impersonal,” adding that his bank is not pursuing it.

Derek Statkevicus, a banking analyst with Keefe, Bruyette & Woods in New York, said remote tellers may be a hard sell. If customers know tellers are just behind a wall, “they would ask, `Why don't I just talk to a teller?'” he said.

He doesn't foresee video banking catching on in a big way, as ATMs and Internet banking have. Americans see the benefit of ATMs, he maintained: “Before ATMs, they had to wait in line for simple transactions like withdrawing cash or depositing a check.”

Down the road, he sees even greater acceptance of the Internet. “Kids raised on Game Boy clearly will be more comfortable with the Internet than my grandmother is.” But as for video banking, “It's not clear to me where the benefit is.”