Smart buildings
banking, Carol Anderson, explains: “The decision to close a branch is never taken lightly. TSB is committed to a national branch network, but needs to ensure that we have the right balance between branches on the high street and our digital platforms.”
The left behind To be clear, TSB is just one of the major banks moving in this direction. Lloyds, Halifax, NatWest and Barclays have also been undergoing what seems to be a perpetual programme of closures. By the end of 2022, Barclays will have faced nearly 180 closures in a single year, contributing to a staggering 938 brick-and-mortar closures since 2015. “Barclays, and others, are continuing to close batches of branches all the time,” says Derek French, a retired banking executive, fellow of the Chartered Institute of Bankers and campaigner for better access to banking services. French believes traditional banks have been “abandoning service provision at branches for years” – and aim to go even further. “The negative impact,” he laments, “is significant for individuals and businesses.” It’s an important point. Often we think of retail customers when a local branch closes, but others suffer too. SMEs (including market stall holders) and charities rely on face-to-face banking in their communities. “For businesses, the closure of bank branches may cause a range of practical problems, such as issues with depositing cash,” warns Evans, who adds the expense of travelling has made some consider whether it’s even viable to continue accepting cash – which can have knock-on impacts for consumers who rely on physical coins and notes day-to-day. In response to branch closures, customers are looking at other ways to bank – ones not associated with the digital transition. One has been to use services offered in post offices. Indeed, TSB encourages its customers to access them, signposting them on their website and when announcing a branch closure.
And as Evans says, post offices are picking up some of the slack. “For example, through 2021–22, where the last bank branch in an area closed, the local post office saw cash deposits increase by 20%, compared with just 7% where the last bank remained open.” Across the UK, the Post Office says more than £3.3bn was deposited or withdrawn across its 11,500 sites in June this year alone. In short, there are clearly other ways to bank. But as French warns, they’re far from ideal. Literal mobile banking – on wheels, moving through communities – isn’t a new concept and is still operated in some parts of the country. But, plagued by criticism, the idea often hits the headlines for its failings rather than its successes. “Mobile bank vans for transactional banking are not sustainable
Future Banking /
www.nsbanking.com
in England,” French says, “though a limited case exists for rural Wales and Scotland.” History is a good tutor here: HSBC and NatWest (as it’s now known) ran such services for decades. But, French says, they were ultimately scrapped due to the huge costs involved – no new profitable business ever came from them.
The Post Office setup, too, has its limitations. “Post Office branches can certainly provide some form of lifeline for basic banking services in communities with no other alternatives,” Evans says, “but not all branches are the same.” Some Post Office branches, for their part, lack the privacy customers need for consultations, while others lack bank-specific expertise. “While something is better than nothing,” Evans adds, “it is important that consumers have some form of banking expert they can easily contact.”
Pop up or hub?
Despite all this, banks say they have solutions. In addition to Post Office services, greater access to cash through in-store cashback schemes, and an increase in the number of free-to-use ATMs, pop-up branches and banking hubs are now being piloted and rolled out. “Despite the shift towards digital banking, we know accessing banking services and cash remains important to many customers,” TSB’s Anderson says. “We’re always looking for innovative and inclusive ways to help.”
TSB has a network of 52 pop-ups in mainland Britain, based everywhere from town halls and churches to libraries and community centres. As Anderson puts it: “The service helps customers with their banking, such as making payments, getting help with products and services, and assistance with bereavements.” Despite those face-to-face services, however, staff are not able to handle cash. TSB’s Nottingham site is the exception, having recently embarked on a partnership with OneBanx – which
Above: Mobile banking vans are handy, but aren’t a sustainable substitute for physical branches.
Opposite: The
familiar sight of a bank branch closure.
Jamie Evans, senior research associate at the Personal Finance Research Centre.
Derek French, fellow of the Chartered Institute of Bankers.
Graham Mott, director of strategy at Link.
31
SN Thomas Photography/
Shutterstock.com; Personal Finance Research Centre; Chartered Institute of Bankers; Link
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