Heart and soul

When ATMs emerged in the 1960s and 1970s, some futurists saw it as the beginning of the end of community banking. It clearly wasn't. Today, we see many actors challenging community banks using technology. For example, Rocket Mortgage advertises "Click Button. Get Mortgage." So, is this now the end?

Of course not. And the truth is that the so-called "easy button" is not always as easy as it seems.

Sure, it is a reality that there has been more technological advancement in the last 25 years than at any time in history. Recent generations, to include millennials (born about 1981-1996) and Gen Z (born between 1997-2010), have grown-up with quickly advancing digital platforms. Market prominence will be theirs in the near-term. As bank customers, they are highly connected and expect to have speedy access to tech-enabled services as they manage their financial life and investments.

But this does not mean that these customers aren’t or won’t be connected to community banks. In fact, the opportunity for these generations to be “sticky” with community banks is right in front of us just as it has been in previous generations.

First, community banks are innovating and providing digital banking services more than ever before. TBA is proud to help our community banks leverage tech.

But there is another reason. Broadly, millennials have not yet experienced key life events such as sending kids to college, struggling to meet the care needs of aging parents, dealing with relationship and employment challenges as well as managing serious personal illnesses either for themselves, a spouse or loved one.

On the positive side, the life and professional experience they are gaining over time may put them in position to start their own business or pursue other opportunities that may require capital. When these major life changes begin to hit our truly tech-dependent generations, the “easy button” won’t be enough.

They will need to talk to someone face-to-face. Someone they know and who knows them. Someone who is nearby and will listen. Someone who knows their family and circumstances. Someone who will care in challenging times and someone who understands their dreams and opportunities. This is the community bank difference and it is a community bank competitive advantage.

In this issue of Texas Banking, you’ll see a focus on TBA efforts to educate future Texas bank leaders. The innovations and technologies they will utilize will continue to evolve, but community banking’s heart and soul — its people — will never be replaced by hardware and software. And it is this heart and soul that will ensure the next great era for Texas community banking.