Launched in January this year, Equitable Bank’s digital platform EQ Bank has confounded the expectations of even the firm’s management. Offering mobile and online banking, the service proved such a hit that the bank had to temporarily freeze opening new accounts earlier this year. According to VP of Digital Banking at EQ Bank, Dan Dickinson, the success of the launch is sure sign that a corner has been turned for retail banking in Canada.
“It really exploded much faster than we expected,” he says. “Our first-year target was 10,000 accounts and we blew through that in the first few weeks. We now have over 24,000 active customers.”
The popularity of online and mobile banking among millennials would have come as little surprise to the brain trust at Equitable Bank. That Boomers have embraced digital platforms was a little harder to predict, however.
“People we thought might have been reluctant to go with an online bank – that reluctance really wasn’t there,” says Dickinson. “We won’t be the bank for everyone; we won’t do chequebooks, or paper statements, but we think we’ll be the right bank for the digital-first customer.”
The rise of digital banking has coincided with many of the big banks downsizing their retail operations. Does this mean the future of the local branch is in doubt, however? EQ Bank’s VP of Digital Banking believes technology is changing banking just as it has done in most business transactions in our day-to-day lives.
“The more complex the product the more people will want to have a conversation with someone, but you can’t necessarily equate that to going a branch,” he says. “As technology advances you can have a conversation on a smartphone using Facetime and look someone in the eye and still feel good about your decision.”
Being a digital bank clearly has advantages when it comes to limiting some of the costs a branch may incur such as paying staff. There are pitfalls, however, as Dickinson concedes. “Technology isn’t the main thing I’m worried about – it’s the consumer expectation,” he says. “We are certainly keeping an eye on all the technology plays around banking, but ultimately you have to marry that with the stability the consumer feels with the Canadian banking system.”
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