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Tuesday, July 23, 2024

BankFive Leverages Technology and Beneficial Products to Meet Its Customers Where They Are

Bankfive Focused On Meeting Customers Where They Are
Mike Senecal

Written by: Mike Senecal

Mike Senecal
Mike Senecal

Mike Senecal draws on more than 20 years of editorial experience to update readers on industry trends, business news, and best practices in budgeting and credit use. Mike has worked for decades in academic and trade publishing, including roles as managing editor and technical editor at the University of Florida and as contributor to finance industry publications, including Surety Bond Quarterly and Independent Agent, among others. Mike holds bachelor’s and master’s degrees from the University of South Carolina, and he enjoys bringing his years of academic and industry expertise online to help consumers of diverse financial backgrounds.

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Edited by: Lillian Guevara-Castro

Lillian Guevara-Castro
Lillian Guevara-Castro

Lillian Guevara-Castro brings more than 30 years of editing and journalism experience to the CardRates team. She has written and edited for major news organizations, including The Atlanta Journal-Constitution and the New York Times, and she previously served as an adjunct journalism instructor at the University of Florida. Today, Lillian edits all CardRates content for clarity, accuracy, and reader engagement.

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In a Nutshell: A history of nearly 170 years in financial services means you must be doing something right. BankFive started in 1855 as a five-cent savings bank serving factory workers who couldn’t afford the $1.00 minimum deposit required at other institutions. Today BankFive reaches out to customers from all walks of life to provide financial access and encourage success. Inclusive products and services combine with commitments to technology, businesses, and communities to make BankFive a leading American mutual savings bank.

Banks need customers to stay in business, and consumers need financial services to achieve their goals. The only question is how to connect them.

Some financial providers target customers based on margins and profit. Others, like BankFive, based in Fall River, Massachusetts, think of themselves as furthering a social goal of financial inclusion.

They reason that communities thrive best when everyone has a chance to succeed.

What’s distinctive about the BankFive story is it landed on that strategy about 170 years ago. BankFive started in 1855 as the Fall River Five Cent Savings Bank, welcoming the area’s textile workers by allowing an introductory deposit of a nickel when competitors required a dollar.

BankFive logo

BankFive is a mutual savings bank with a structure similar to that of a credit union in that account holders, not shareholders, own it. Mutuals traditionally focus on community involvement and betterment rather than on producing large stock returns. Corporators representing the bank’s customers choose local leaders to comprise the board of directors.

Fall River is a state-designated Gateway City, one of 26 small to midsized cities in Massachusetts that anchor regional economies. With 13 full-service branches and five lending offices throughout Massachusetts and Rhode Island, BankFive is a locus of inclusive development in communities overlooking the waters of the Atlantic south of Boston.

Beneficial products, openness to innovation, and community spirit help BankFive stay vital and meet new challenges.

“Those mid-19th-century factory workers didn’t have the dollar that was required at other banks to open an account,” said Catherine Dillon, BankFive’s Chief Operating Officer. “More than a century and a half later, we still have the same mission of service to our customers, employees, and community.”

Products Encourage Positive Financial Actions

Products and services are the linchpins of financial inclusion and community development. BankFive prides itself on offering a product lineup that is inclusive at its core. As a DIF member bank, it insures unlimited deposits.

Checking products include Free Checking, a no-fee, no-minimum-balance option. True to its origins as a five-cent bank, BankFive also offers Basic Checking, which earns interest after only a $10 minimum deposit.

Checking options for students and veterans cater to specialized community needs. Student Checking includes ATM reimbursements. Veterans Checking includes ATM reimbursements and integrates with VA Direct Deposit.

“We’re proud to offer benefits to those who have served,” Dillon said.

Lucky Piggy
Lucky Piggy gives customers an entry in a $1,000 monthly drawing for every $25 savings increase.

On the savings side, Lucky Piggy is a product that incentivizes discipline. Lucky Piggy is a prize-linked savings account. Customers receive a chance to enter a $1,000 monthly drawing for every $25 increase to their total savings deposit month over month.

A $50 increase gets you two chances, and so on. A $1,000 year-end jackpot drawing sweetens the deal. Unlike buying a lottery ticket, the money doesn’t go down the drain if you don’t win. Dillon sees Lucky Piggy as a way to help customers build a nest egg to handle the unexpected.

“Customers love it as a fun way to help them save,” Dillon said. “You get the thrill of possibly winning, but you can’t lose because that $25 stays in your account.”

BankFive offers a credit opportunity through its Interest-Only Collateral Loans, which allow customers to borrow against their savings. Interest is only 3% over the rate for the account that secures the loan.

BankFive also offers Passbook Savings Accounts, something that a lot of larger banks have done away with. Customers receive a physical passbook, and in-person tellers must log the transactions. BankFive customers learn to manage their finances and build a healthier credit score for the future.

“It’s all about accessibility,” Dillon said. “Even if you don’t have a lot, we want to help you build.”

Innovation Designed to Improve Accessibility

BankFive may use a physical passbook with Passbook Savings, but it’s on the technological cutting edge in every other way. Mobile and online banking are well established, with video banking the newest kid on the block.

Video banking allows customers to use their phones to speak face-to-face with a BankFive representative, complete and submit forms, manage their accounts, and receive answers to all their banking questions.

“We can do a lot of transactions that we couldn’t do just on the phone because it helps us identify customers,” Dillon said.

Video banking
Video banking connects customers seamlessly with BankFive representatives.

Disputes and address changes are among the types of transactions available through video banking. What once required a trip to a physical branch is now possible at home because BankFive reps can see IDs and take screenshots. Document sharing and signing through DocuSign make transactions seamless. Video banking is a perfect add-on service to help customers of all ages access the banking services they need when and where they need them.

COVID-19 spurred BankFive to these heights. Employees went home with about 36 hours of advance notice. About 30 days after the pandemic was declared a global health emergency, the bank transitioned employees to an internal network. Workers and customers quickly grew accustomed to new ways of doing things.

Interactive teller machines (ITMs) provide another example of how the institution serves its customers. BankFive began assembling a fleet of these automated banking kiosks in 2017-18. The pandemic led the team to place higher emphasis on the transition. BankFive is converting one of its loan offices into a digital branch and building a new one in a Rhode Island location. It’s the future.

That said, BankFive is a branch-based institution and always will be. Dillon said bank surveys reveal that even younger customers value in-person branches nearby.

“We want to meet our customers where they are in the technology spectrum,” Dillon said.

Mutual Savings Status Drives Social Mission

Support for small businesses is integral to the mutual savings model. BankFive offers flexible and innovative products to serve the lending needs of its business customers.

It participates in Jobs for New England, a program of the Federal Home Loan Bank of Boston, to support below-market-rate business loans. It works with the South Eastern Economic Development Corporation, an economic development nonprofit, to facilitate lending through the U.S. Small Business Administration.

“We try very hard to help customers get the financing they need to grow their business,” Dillon said.

Financial education is also a priority in schools and communities. BankFive presents Credit for Life fairs in local schools to help students understand the positive and negative consequences of money decisions. It also partners with Junior Achievement to teach financial literacy in schools.

Catherine Dillon
Catherine Dillon is BankFive’s Chief Operating Officer.

In the community, BankFive sponsors events to help real estate agents understand the changing marketplace. It also works with CPAs and attorneys on essential issues and has sponsored a small business series with the local Chamber of Commerce.

Education about PPP loans was a priority during the pandemic. BankFive’s ongoing commitment to cybersecurity helps customers and businesses stay safe as new forms of fraud and identity theft emerge. It is always ready to help constituencies understand the financial implications of change.

Community involvement is also a priority. In 2023, BankFive’s Charitable Foundation and Charitable Giving Program gave more than $600,000 in sponsorships and donations.

Scholarships are a highlight. In 2023, BankFive and the SouthCoast Community Foundation awarded the first $40,000 Presidential Scholarship to Fall River resident Malachia Nobre. The life-changing award is one of many forms of student support BankFive makes possible.

All from a bank that started because textile workers couldn’t afford a $1 deposit. Dillon said the Presidential Scholarship will become a fixture.

“It’s great to know we’ll always have that sort of impact on our community,” Dillon said.