HONOLULU (KHON2) — As more people opt for digital convenience and avoid face-to-face interactions after the start of the pandemic, businesses are seeing less people showing up. Banks are among the industries struggling, hitting a new record last year in shutting down retail branches.

According to a new study, the bank branch closure rate doubled during the pandemic.

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Between 2017 and 2021, almost one in ten branches closed — many of them happened during the pandemic. Among the 50 metros with the most branches in 2017, Portland, Oregon, saw the greatest percent of local branches close (20%), according to the National Community Reinvestment Coalition (NCRC).

While Hawaii’s numbers don’t compare to those on the mainland, the state still saw 16 branch closures last year, according to S&P Global Market Intelligence data.

Dani Aiu, Executive Vice President, Consumer Banking of American Savings Bank (ASB), told KHON2 that it’s been their plan to reduce their physical footprint. They have consolidated several of their branch operations over the past few years as more customers choose different ways to bank.

ASB was also offering convenient digital options before COVID-19 hit, but after the world shut down, they accelerated their plans to enhance their online services.

“The pandemic shifted the way many of our customers are banking, and more people are taking advantage of our online and mobile banking solutions,” Aiu said. “Our goal is to continue making banking easy no matter how, when or where our customers choose to interact with us.”

Last year, ASB introduced four new digital centers in Honolulu Walmart, Waipio Foodland, Laie Foodland and in Kapaa on Kauai.

“Unlike our other locations, businesses and customers are welcome to use our full-service ATMs, where they can make deposits, withdrawals, transfers and more,” said Aiu. “We also have bankers on-site to provide in-person assistance.”

While many communities experienced a loss in access, most closures of bank branches involve the biggest names in the market, including Wells Fargo and JPMorgan Chase. The former had the largest branch network in 2017 but has since closed nearly 1,000 branches.

So what will banking looking like in 20 years?

The NCRC said it’s likely several trends will continue to affect operations: bank mergers, artificial intelligence becoming more sophisticated, algorithms being used to automate banking functions and the growing need to do online banking while saving costs on fully-staffed locations.

Physical retail branches, however, remain critical for supporting small businesses in their communities, especially in rural areas or low-income neighborhoods where there are fewer branches servicing them.

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As the pandemic continues to supercharge banks’ plans to close locations, the NCRC is calling on federal regulators to protect these affected communities, saying that physical banks are a key factor in local economic outcomes. For more information, click here.