Friday, May 17, 2013

Here comes the digital divide in banking

The City of Cleveland is getting very concerned about losing neighborhood bank branches, as some big banks look to reduce costs by pushing ever bigger shares of their customer interactions on line. A recent survey conducted for the Board of Governors of the Federal Reserve is apparently being cited in the industry as evidence that the mobile Internet offers a better way to reach "the unbanked" with financial services than continued support for physical branches in poor communities.

At the City's invitation, Samantha Cycyk and I spoke yesterday to a gathering of neighborhood development organization staff about the results of OneCommunity's recent Cuyahoga County Broadband Inclusion Survey. Samantha put together a presentation outlining the large number of Cleveland residents -- especially older and lower-income residents -- who still have no regular access to the Internet, as well as the very limited impact of mobile Net access on Clevelanders who are otherwise unconnected.  The point being, of course:  When more than 40% of adults in the city don't have home broadband, and more than a third don't have either home broadband or mobile Internet access, how do you swap a local branch for a web page without cutting off access for a lot of current and potential customers?

Here's the presentation (in PDF format, click to open):

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