Did Local Factors Contribute to the Decline in Bank Branches?

Sengupta, Rajdeep; Dice, Jacob

doi:10.18651/er/3q19senguptadice

Cited by 3 publications

(5 citation statements)

References 3 publications

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“…Huysentruyt et al (2012) explore the determinants of the patterns of bank presence in the neighbourhoods of Antwerp between 1991 and 2006. Their empirical results show that, in addition to market structure conditions, the socio-economic environment also has a high influence on branching decisions; these outcomes are confirmed by several recent papers (among others Qi et al, 2019;Sengupta and Dice, 2019;Chen & Strathearn, 2020;Stix, 2020) Argent and Rolley (2000), Felici andPagnini (2008), Okehalam (2009), Cohen and Mazzeo (2010), Alamà and Tortosa-Ausina (2012), Huysentruyt et al (2013) and Alamà et al (2015) argue and demonstrate that the number of inhabitants is a factor influencing attractiveness for bank branches. However, analysing Portuguese bank branching decisions between 1988 and 1996, Barreto and Badenfuller (2006) find that banks also imitate their legitimacy-based groups towards unattractive locations, producing a negative effect on profitability.…”

Section: Literature Reviewsupporting

confidence: 53%

Determinants of Bank Branch Presence in Local Areas: A Comparison Between North and South of Italy

Barbieri¹,

Borroni²,

Lippi³

et al. 2021

IJEF

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A close relationship with customers, mainly achieved through the opening of local branches, has long been a fundamental key to competitive advantage in the banking sector. Financial innovation, changes in customer behavior and competitive dynamics have transformed this relationship over time, leading to the closure of numerous branches. This work explores the determinants of branch evolution in an advanced and notoriously bank-centric country (Italy) using NUTS 3 panel data over the 2000-2016 time-span. Results show how - in general - demographic, industrial and economic variables explain the dynamics of banks’ branch location strategy. However, more heterogeneous evidence emerges when North and South Italy are taken into consideration separately suggesting that territorial and regional dimension might play a role even in the banking sector.

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Section: Literature Reviewsupporting

confidence: 53%

Determinants of Bank Branch Presence in Local Areas: A Comparison Between North and South of Italy

Barbieri¹,

Borroni²,

Lippi³

et al. 2021

IJEF

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show abstract

“…Digital servitization is particularly pronounced in the banking industry (Mbama et al , 2018; Sengupta and Dice, 2019). Mobile banking is transforming the customer experience from primarily brick-and-mortar, face-to-face transactions to technology-mediated, consumer-centric services (Laukkanen, 2016; Baabdullah et al , 2019).…”

Section: Introductionmentioning

confidence: 99%

Enhancing the value co-creation process: artificial intelligence and mobile banking service platforms

Payne

Peltier

Barger

2021

JRIM

127

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Purpose The purpose of this study is to investigate the relationships that influence the value co-creation process and lead to consumer comfort with artificial intelligence (AI) and mobile banking (AIMB) service platforms. Design/methodology/approach A conceptual model was developed to investigate the value-in-use perceptions of AI-based mobile banking applications via five antecedents: baseline perceptions of current bank service delivery; service delivery configuration benefits; general data security; safety perceptions of specific mobile banking services; and perceptions of AI service delivery. Data were collected from 218 respondents and analyzed using structural equation modeling. Findings This study highlights the role and importance of the sequential relationships that impact the assessment of AIMB. The findings suggest that service delivery and the customer’s role in value co-creation change as AI is introduced into a digital self-service technology channel. Furthermore, AIMB offers transaction-oriented (utilitarian) value propositions more so than relationship-oriented (hedonic) value propositions. Research limitations/implications The sample consisted on digital natives. Additional age cohorts are needed. Practical implications As financial institutions redirect their business models toward digital self-service technology channels, the need for customers to feel comfortable while interacting with an AI agent will be critical for enhancing the customer experience and firm performance. Originality/value The authors extend the service-dominant logic (SDL) literature by showing that value co-creation is a function of both firms’ technologies and consumers’ value-in-use, a finding that appears to be unique in the literature. The authors advance the digital transformation literature by evaluating AIMB as an interactive process that requires an understanding of key technology constructs, including perceptions of baseline service relationships, desired service configurations, security and safety issues and whether AI is useful for value co-creation. To the best of the authors’ knowledge, this is the first SDL framework that investigates interactive and structural relationships to explain value-in-use perceptions of AIMB.

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“…Today, urban neighborhoods face a new challenge. Bank branch numbers are declining (Morgan et al ., 2016; NCRC, 2017; The Economist , 2017; NCRC, 2018; Tranfaglia, 2018; Sengupta and Dice, 2019). At the same time, alternative financial products and services offered by brick‐and‐mortar AFSPs are proliferating in urban metropolitan areas (Caskey, 1994; 2005; Burton et al ., 2004; Langley, 2008; Aitken, 2013; Rowlingson et al ., 2016).…”

Section: Literature Reviewmentioning

confidence: 99%

“…The US has seen an overall trend of brick‐and‐mortar bank branch closures after the financial crisis of 2008 (Morgan et al ., 2016; NCRC, 2017; The Economist , 2017; NCRC, 2018; Tranfaglia, 2018; Sengupta and Dice, 2019). According to the NCRC, the number of brick‐and‐mortar bank locations nationwide fell from 95,379 in 2009 to 85,713 in 2017, a decrease of 10% (NCRC, 2018).…”

Section: Literature Reviewmentioning

confidence: 99%

“…Today, urban metropolitan areas in the US face declining bank and credit union branch numbers (NCRC, 2017; Tranfaglia, 2018; Sengupta and Dice, 2019) while alternative financial service providers (AFSPs)—including check‐cashing outlets, payday lenders and other ‘fringe’ providers—are proliferating (Caskey, 2005; Faber, 2018). Access to mainstream brick‐and‐mortar financial institutions, and the host of safe and affordable financial products and services they offer, is essential for local economic development (Leyshon and Thrift, 1994; Dymski and Veitch, 1996; Benjamin et al ., 2004) and is generally thought to promote financial inclusion (Jones, 2006; Friedline et al ., 2017; Birkenmaier and Fu, 2018; Sherraden et al ., 2018).…”

Section: Introductionmentioning

confidence: 99%

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FRINGE FINANCIAL ECOLOGIES AND PLACE‐BASED EXCLUSION: A Tale of Two Cities

Dunham¹,

Foster²

2023

Int J Urban Regional Res

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Access to safe and affordable financial services is essential to the economic well‐being of individual households and entire urban neighborhoods. However, prior research raises concerns about spatial inequities in the distribution of brick‐and‐mortar financial services offerings—either mainstream financial institutions or alternative ‘fringe’ financial service providers—and the resulting implications for financial inclusion and social justice. This study uses a novel method to identify fringe financial ecologies that captures the recent tandem processes of abandonment by mainstream financial institutions and the proliferation of alternative financial service providers. We explore how fringe financial ecologies potentially overlap existing inequalities of race, class and subprime mortgage lending in two US metropolitan areas, Los Angeles, California, and Miami, Florida. Our results raise concerns that communities of color, low‐income neighborhoods and otherwise vulnerable segments of the population are disproportionately at risk of both financial exclusion and predatory targeting. We find that fringe financial ecologies are associated with a high prevalence of subprime mortgage lending. The results advance an understanding of financial ecologies that raises awareness about place‐based financial exclusion as a form of systemic racism in the broader context of the national reckoning with racial justice in the US.

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Did Local Factors Contribute to the Decline in Bank Branches?

Cited by 3 publications

References 3 publications

Determinants of Bank Branch Presence in Local Areas: A Comparison Between North and South of Italy

Determinants of Bank Branch Presence in Local Areas: A Comparison Between North and South of Italy

Enhancing the value co-creation process: artificial intelligence and mobile banking service platforms

FRINGE FINANCIAL ECOLOGIES AND PLACE‐BASED EXCLUSION: A Tale of Two Cities

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