COLLECTIONS CCR


CONSUMERS IN TOUCH WITH BANKS MORE THAN EVER


The large increase in digital banking has led to an increase in customers’ contact with their banks By Anthony Browne


CONSUMERS are now in touch with their bank more frequently than ever before, according to new research. In 2015 UK customers interacted


with their banks about their current account 2.1 billion times – an average of 3.5 times per month each. This is an increase of nearly 50% compared to 2010. CACI, who carried out the research


on our behalf, predict that in 2020 customers will interact with their banks 3.2 billion times – more than five times a month on average. This is largely being driven by a large increase in the uptake of digital banking.


Biggest ever effective branch network Some people however, are not comfortable banking digitally. All the major high-street banks have now done


deals with the Post Office which allow their customers to carry out basic banking services in Post Office branches. This means that there is now a network of over 20,000 places where customers can bank. This is the largest effective bank


branch network the UK has ever had. It has halved the distance people need to travel to get to a place where they can carry out basic banking face to face. Furthermore, according to the


research: t On average, people live 2.1 minutes’ drive away from a place where they can bank face to face. t 99.9% of people in Britain live within 20 minutes’ drive of a bank branch or Post Office. t When the 68,000 ATMs in the UK are included, the average banking


service is 1.4 minutes away – closer than the average local pub (1.6 minutes) and primary school (1.7 minutes) t 97% of people over the age of 80 live within half a mile of a bank branch, Post Office or ATM It is now easier than ever for people


to do their banking. They can check their balance, pay back a friend digitally, or speak to their bank for advice 24/7. That means we are all in touch with our banks now more than ever before. But technology is not for everyone,


which is why all the major banks have done deals to allow customers to do basic banking through Post Office branches. That means there are now more places to bank than ever before. This is important to make sure that


no-one gets left behind, which is why banks are also investing in new ATMs and mobile bank branches to reach more rural communities. CCR


Anthony Browne is chief executive of the British Bankers’ Association


ALTERNATIVE FINANCIAL INSTITUTIONS


MORE than 8.8 million people are now over-indebted due to more than two years of increasing household debt. Low-income households face the biggest challenges from Britain’s mounting personal debt, as they often have little choice but to take on high-cost short-term credit. Our research finds that low-income


consumers and those struggling with problem debt should have financial services and products designed around their wants and needs – not in a way which robs people of personal responsibility. For more than a decade, we have documented how problem debt is a cause of poverty, as well as a consequence. It damages families, affects mental health and makes it extremely difficult for people to get back on their feet. The coalition government achieved important progress but our report shows


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the time has come for a radical shake up of the lending market. We need to create a new generation of responsible lenders to offer people an alternative to the dangerous debt spiral many get stuck in. Credit unions only take us so far. This revolution in tackling problem


debt should form an important part of the new government’s ‘one nation’ plan. But our report is also a rallying call to the private sector who could be doing so much more to help a group currently forced into the arms of dodgy lenders. People from low-income households


often have to rely on banking services designed for people with larger or more regular income which can leave them worse off. Low-income households often find it difficult to manage direct debits for example, which can lead to them becoming overdrawn and hit by heavy fines.


www.CCRMagazine.co.uk In the USA and the UK, a number of


social enterprises offer a range of services to help people bridge income gaps, build savings, improve their financial skills and get safe advice about their debts. These alternative financial institutions (AFIs) provide a blueprint for the models that need to be encouraged and expanded to tackle problem debt. The government could lead AFI


development by promoting a specialised body to facilitate social investment in innovative AFIs and launching a new accelerator programme to help them achieve scale through technology.


By Christian Guy, director, the Centre for Social Justice


July 2015


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