Survey: 3 in 4 Americans Believe Physical Banks Are Becoming Obsolete

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Thanks to the fintech revolution and ever more sophisticated bank apps, some aspects of banking — like paper checks and statements that come in the mail — seem pretty outdated. For many Amercians, bank branches are also increasingly seen as redundant.

A new survey from MagnifyMoney, a LendingTree company, found that 3 in 4 Americans think that physical bank branches are becoming a thing of the past, and nearly 8 in 10 do all of their banking online or via a mobile app.

Key findings

  • Approximately 3 in 4 of survey respondents say physical bank branches are becoming “a thing of the past.” Unsurprisingly, millennials and Gen Z are most likely to hold that opinion, but the sentiment is also shared by more than two-thirds of baby boomers.
  • More than 1 in 10 Americans with bank accounts didn’t set foot in a bank branch in the last year, and an additional 15% haven’t visited a branch in at least the last six months. Gen Xers are the least likely to have visited a branch in the last year.
  • There’s an app for that… and people are using it. Nearly 8 in 10 conduct all of their banking business online or via a mobile app whenever possible. Still, people still see in-person interactions with their bank as valuable, with almost 50% of respondents saying this is their preferred method of communication with their bank.
  • Credit union account holders visit their bank’s physical location less frequently than those who use a traditional bank, and they’re more likely to prefer online banking.
  • Making a deposit is the most common reason cited by respondents for visiting a bank branch, followed by making a withdrawal.

Americans are visiting bank branches less often

Our survey reveals that trips to the bank are becoming increasingly rare. The survey found that 29% of Americans say they typically only visit bank branches a few times a year, while 14% say they go less than once a year. The survey shows that the most common reason for a respondent’s most recent trip to a physical bank was to make a deposit (39%), followed by making a withdrawal (32%).

Surprisingly, the frequency of trips to physical bank branches doesn’t differ too much among generations. However, younger people were more likely to agree with the statement that physical banks are becoming a thing of the past, including 89% of Gen Zers, but only 68% of baby boomers.

In an era in which finding a date or having pad thai delivered to your doorstep is as easy as a few taps on your phone, it’s not surprising that more people are turning to apps for their banking needs. Our survey found that 78% of Americans say they conduct all of their banking online or through a mobile app, including an eye-popping 87% of millennials. Paradoxically, respondents also indicated that facetime remains important, with nearly half saying that speaking with a bank representative in person is their preferred mode of communication.

How different generations bank

Different generations have different preferences on everything from fashion to food. Their preferred mode of banking varies, too. Unsurprisingly, younger generations — who’ve grown up with technology at the center of their lives — are more likely to use a digital bank for their banking needs.

The survey found 21% of Gen Zers and 18% of millennials have their primary account at an online bank, compared to just 8% of baby boomers. Still, about 51% of Gen Zers and 59% of millennials have their primary accounts at a traditional bank — compared to more than 73% of baby boomers.

Younger generations were also much more likely than older ones to say that they do all of their banking online or via an app — 87% of millennials, compared to 67% of baby boomers.

Digital banking on the rise

As both fintechs and conventional banks invest more in their digital offerings, consumers have fewer reasons to visit a physical bank branch. JP Morgan Chase, for example, offers digital banking services like the ability to directly deposit checks straight from your phone to your accounts, and the option to check your balance and transaction history via text message.

The advantages of online-only banks further erode the draw of brick-and-mortar branches. Digital-only operations like Ally Bank and Chime offer very attractive APYs with no monthly fees, as they are saving money on overhead costs.

Cash management accounts from fintech companies can provide compelling alternatives to traditional bank accounts. For example, SoFi Money holds each customer’s cash in accounts at multiple partner banks. This arrangement means the partner banks provide a combined $1.5 million in FDIC insurance for each SoFi Money customer’s balance.

Other innovative features include Chime’s SpotMe feature, which grants its customers up to $100 if they overdraft their account, and Simple’s built-in budgeting tools, which seamlessly tell you how much money is safe to spend while taking into account your future goals and expenses.

Why use a physical bank branch?

Despite all the bells and whistles made possible by technology, physical bank branches do offer something an app can’t replace: in-person assistance. The value of physical, human contact shouldn’t be underestimated.

Case in point: In October 2019, Chime experienced a service outage, leaving millions of its customers without access to their accounts. With no physical branches, Chime’s customers were cut off from their money.

Our findings underscore the importance of having the option to waltz into a bank and ask for assistance, if need be: Among survey respondents, the number one preferred way to communicate with their bank was in person, beating phone contact and online chat.


MagnifyMoney by LendingTree commissioned Qualtrics to conduct an online survey of 936 Americans with a bank account. The survey was fielded September 11-13, 2019. In the survey, generations are defined as:

  • Millennials are ages 22-38
  • Generation Xers are ages 39-53
  • Baby boomers are ages 54-73

Members of the Silent Generation (ages 74 and older) were also surveyed, and their responses are included within the total percentages among all respondents. However, their responses are excluded from the charts and age breakdowns due to the smaller population size among our survey sample.