By implementing an initiative that lacks precedent, Capital One Bank is planning to change the process of traditional banking by opening six banking cafés in Boston by the end of 2013, experts say.
The banking cafés will offer customers a chance to open a savings account, make deposits and grab something to eat, said Capital One spokeswoman Amanda Landers.
Current ING cafes throughout the nation offer snacks and drink to customers, according to the ING cafe profiles.
While one can currently only make deposits via mail or mobile banking, deposit-taking ATMs are planned for the future, Lander said.
“As home to dozens of the world’s leading academic institutions, a hotbed of innovation and entrepreneurship and a city passionate about its communities and hometown team, Boston is unlike any other city in the U.S.,” Landers said in an email.
“This is why we chose Boston to launch a new banking experience that will be a departure from traditional banking that people have come to know.”
Capital One purchased ING earlier in the year, and, according to Landers, Capital One plans to improve upon the business model of banking cafés that ING pioneered. The ING DIRECT Cafés will be modeled after similar banking cafés in cities such as San Francisco, New York and Chicago.
The first ING DIRECT Café opened in New York in 2001, according to ING DIRECT Profiles.
The latest café opened in San Francisco in December 2011.
Landers said these cafes will expand the functions of banking branches.
“We’re currently calling our selected spots ‘retail locations’ because we expect they’ll go beyond a bank branch or cafe concept,” she said.
Samina Karim, professor of strategy and innovation at Boston University, said the new banking cafés are trying to influence people to use Capital One’s online banking services.
“Right now it’s a market presence strategy to lure anyone who is not an online banker to come to them for their online banking,” Karim said.
Karim said these new banking cafés will be successful in the short-term for attracting new customers, but these banks cannot forget about the customer service that people seek when banking.
“As they [banks] move away from brick and mortar, people are still going to want advice on how to do things,” said Karim. “That is something they can’t lose sight of.”
Angela Park, a College of Arts and Science senior, said the creativity of idea of the banking cafés and Capital One’s reputation would make her willing to give the locations a look.
“I would be willing to go in and talk about my banking options,” said Park, “There is something more solid about a physical location. It could be a way to attract more customers.”
Ashley Korn, a Graduate School of Arts and Sciences student, said the cafés would not influence how or where she banks.
“I need easy access to my banking,” Korn said. “I do much of my banking online, which gives me limited personal interaction, but I don’t know how much these cafés would change this.”
Karim said the banking cafés in Boston will have to become more than cafés to be successful.
“In the long-term it just can’t stay a café, it has to add more value,” she said, “If they find they are not actually attracting
people to stay there, these perks may get wiped out.”
CORRECTION: The original article incorrectly reported that ING cafes planned to do away with tellers instead of introducing deposit-receiving ATMs, that the first ING Direct Cafe opened in Philadelphia in October 2001 and that Landers said the banking branches will expand Capital One’s customer base. The ING cafes are in fact expected to introduce new ATMs that accept deposits. Also, the first ING Direct Cafe opened in New York in 2001, not Philadelphia. The statement from Landers actually stated that the cafes will expand the functions of the banking branches and that the selected spots are called “retail locations.” The article has been updated to include these corrections.