Off-Premise Banking
What Is Off-Premise Banking?
The term off-premise banking alludes to any bank location that isn't part of its primary branch network. They are much of the time situated in areas where customers could require quick access to cash, like air terminals, shopping centers, and convenience stores.
Commonly, off-premise banking facilities do not have human tellers, yet they are rather outfitted with automated teller machines (ATMs).
Understanding Off-Premise Banking
Off-premise banking locations are a way for banks to keep a broad network of service locations for their customers without investing in the huge startup, payroll, and lease expenses associated with a full branch. They are generally found close to stores and different locations where customers might have to pull out cash.
Albeit off-premise banking locations don't offer the full scope of services given by face to face tellers, for example, mortgage loans, personal loans, or investment products, they truly do satisfy essential capabilities, for example, cash deposits and withdrawals. Now and again, off-premise banking ATMs can likewise accommodate check deposits too.
According to the bank's viewpoint, off-premise banking locations can be a productive investment for a really long time. This is on the grounds that they will quite often have a better cost-than exchange ratio as compared to traditional bank locations staffed by bank tellers and other work force.
Truth be told, the costs of keeping an off-premise banking location are generally much lower than the costs of keeping a branch or even a mini-branch staffed by a single teller. Also, as customers progressively conduct transactions utilizing online or mobile banking platforms, the requirement for full-service branches has continuously declined.
One more advantage of off-premise banking is that ATM machines can be utilized by customers of several banks, in this way making a source of revenue from new customers. Albeit the utilization fees of ATMs might show up small from the outset, they can amount to critical totals when charged across a wide network of off-premise locations. In 2016, for instance, the total amount of ATM fees collected by JPMorgan Chase and Co (JPM), Wells Fargo (WFC), and Bank of America (BAC) surpassed $1.1 billion.
Real World Example of Off-Premise Banking
To show, assume that Bank A has its principal headquarters in Pittsburgh. Bank A has around 25 full-service branches that offer customers access to tellers and bank managers, loan officers, and other customer service delegates. These branches likewise offer a full scope of banking products, from demand deposit accounts to mortgages and car loans.
Bank A needs to make it more convenient for customers to pull out and deposit money, so it sets up ATMs at nearby shopping centers, department stores, gas stations, supermarkets, parking carports, and different locations. It lays out a network of around 100 ATMs in the neighborhood customers can use to pull out and, at times, deposit funds.
These ATMs don't give access to human teller services, and they are notwithstanding ATMs that might be situated on the premises of Bank A's branches. These are off-premise banking locations, and the transactions that occur at them are off-premise transactions.
Features
- Off-premise banking locations are generally run with practically no human staff, rather depending on ATMs.
- Off-premise banking alludes to the banking locations that are not part of a bank's conventional branch network.
- They are normally found at retail foundations where customers might have to pull out cash.
