IT 
ES 
Today, September 18th, marks an important day in how one country, the UK, responds to customer concerns over the loss of bank branches and ATMs in their communities.
From this the date the UK’s financial regulator, the Financial Conduct Authority, formally applies its new powers to regulate how banks shutter bank branches and cut ATM networks.
The new rules have been refined since the FCA consulted on this matter earlier this year. While the FCA reaffirms they cannot stop branch closures, it does expect banks to do the following:
- assess cash access and understand if additional services are needed, when changes are being made to local services
- respond to local residents, community organisations and representative groups, who will be able to request an assessment of whether there are gaps in local cash access
- deliver reasonable additional cash services, where significant gaps are found keep facilities, including bank branches and ATMs, open until any additional cash services identified are available
Whether this is enough to protect services is debatable. In fact, on the eve of the rules going live, the UK’s biggest bank, Lloyds, announced a new list of branch closures across the UK. This is on top of already announced plans to shutter branches.
While there are some improvements in what was originally proposed, there is no serious pressure on banks to retain physical access to cash or how a branch offers wider access to financial services in communities.
The FCA is expecting bank Post Office Bank Hubs to fill the gap. So it is good news that the new UK government has approved 350 new hubs though the FCA must put real pressure on accelerating the time table for their opening. But, as usual this number of hubs is dwarfed by the loss of bank branches and the limitations in what a hub is designed to offer.
Simply having a hub on the High Street isn’t enough. As customers are finding, it is what is inside a hub in terms of access to your bank’s experts when you need them rather than when they are rostered to be available, that’s important. Like Post Office counters, hubs do not provide a like for like replacement of the branch banking services that have been lost.
Face-to-face and physical banking channels are important to customers. Banks talk about the importance of customer centricity and being there when customers most need them. So they should do more to preserve and even improve their branch and ATM channels.
Let’s hope that the FCA remains open minded about how these rules need to be kept under review. There are technology and management solutions that both keep bank branches open on the High Street and profitable. Indeed, banks like Nationwide are investing in their branches and ATM networks to serve customers; so it is possible for banks to be ambitious and imaginative about their commitment to customers who request face-to-face services.
