A Changing Tune in Banking
The classic Peter, Paul, and Mary song, “Where Have All the Flowers Gone,” captured an era marked by change, much like what’s occurring now in banking. During a recent visit to my bank, I noticed a stark absence of loan officers and business activity. Instead, only tellers manned the stations. When I inquired, I was directed to an online application process for loans centralized at the bank’s main headquarters, with no loan officers physically present.
This shift made the bank feel empty and unfamiliar. Even though Sandy mentioned a loan officer was possibly making sales calls, the absence was palpable. Curious, I visited another bank nearby, only to find it closed for foot traffic, with an ATM as the sole service provider. It’s perplexing – why the detachment from personal interaction, the warmth of human connection?
Redefining Deposits and Reserves
The reality is, banking has changed fundamentally. Our deposits, though held at the bank, are actually redistributed to a central bank every night. Banks draw their funds primarily from this central reserve, not solely from customer deposits. They encourage savings and offer interest-bearing accounts to meet their own reserve requirements, making the relationship between the bank and its customers more nuanced than it appears.
The Technological Revolution
Technology has revolutionized banking, reducing the need for a surplus of on-site bankers. This trend extends beyond banking – think automated cable service changes, interactions with stock brokerages, or even ordering appliance parts. We’ve embraced technology for efficiency, cost-cutting, and heightened profits.
Now, interactions between our computers and those of banks are becoming more direct, minimizing the need for our involvement. This paradigm shift extends to other aspects of life. Consider our cars – they’re becoming self-sufficient in scheduling maintenance, rendering our involvement almost unnecessary.
The Decline of Traditional Banking
The days of traditional banking, with its human-centric approach, seem numbered. As our world becomes more intertwined with technology, the need for traditional bankers diminishes. It’s a transformation reflecting broader societal changes, where automation and technology drive our experiences, even in realms as personal as our financial dealings.
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