Richwood Bank offers all of the standard financial services: savings and checking accounts, mortgages, auto loans, and insurance products. Thanks to the advent of mobile banking, which makes it possible to deposit a check with a photo, fewer customers were going to the Richwood, Ohio bank to do their banking.
“A lot of other banks do what we do; how do we differentiate ourselves?” asks Richwood Bank president and CEO Chad Hoffman. “Checking and savings accounts are not enough; we needed to figure out a new model or we’d disappear.”
To bring in business, Hoffman pitched his board of directors a radical idea: open a coffee shop in the lobby. He reasoned that a café would draw people into the bank and entice them to do business on-site. Hoffman got approval for the project and Richwood Coffee opened in 2015.
Richwood Bank isn’t the only financial institution banking on coffee. Several major financial institutions, community banks, and credit unions are offering lattes with loan applications.
Capital One operates nineteen Capital One Cafés; ING Direct opened cafés in its Paris and Lyon, France branches, and First Bank and Trust in Sioux Falls, South Dakota, is opening a hybrid location with local coffee shop Coffea Roasterie later this year.
Most of these cafés offer banking services with coffee shop perks like fresh-brewed beverages, free Wi-Fi, and lounge seating. Capital One describes their cafés as “hubs that serve as spaces for local residents to learn about their finances, but also to eat, work, and meet.” The combination of bankers and baristas help attract new business and build customer loyalty.
Richwood Coffee served up 4,500 cups of java to the local population of 2,000 in November. In the bank, where transaction volume declined 10 percent from 2013 to 2015, transactions increased 12 percent after the café opened.
The addition of an on-site coffee shop has been so successful that the board approved coffee shops in two more bank branches: Richwood Bank will open coffee shops in its Delaware and Marysville, Ohio branches this year.
“The number of people who are walking in the door and experiencing us has skyrocketed,” Hoffman says.