A bank on your high street is becoming as rare as a gas showroom (remember them?) or a haberdasher’s. About 3,000 have closed in the last decade with the rate of closures escalating. It is estimated by Which?, the consumer group, that 1,046 closed in the last two years.
If you want proof of how seemingly unstoppable the trend is, the doughty Derek French, who campaigned tirelessly for community banking — especially local bank branches — threw in the towel last year, saying, ‘There’s no hope of changing anything. We’re realists.’
But could the trend be, if not reversed, at least halted? This week Nationwide Building Society opened a new branch in Glastonbury, Somerset, a town that had lost all its banks. As recently as 2014 Glastonbury had four different branches. And would you believe it — there was a queue of customers waiting to go inside the branch when it opened its doors, according to the local paper.
Rather cleverly, Nationwide said it would only open a new community branch in the town if enough locals signed up to open accounts. Over 1,000 did so.
Of course there are plenty of good reasons why banks are closing. In 1988, 25 per cent of adults were paid in cash – an almost incomprehensible figure now. Cheque usage has declined,though possibly not as dramatically as people believe. Cheque usage peaked in 1990, when 4 billion payments were made by cheque. Back in 2015 it was 500 million, proving they have not died off. And there are plenty of people — not just pensioners — who do not want to bank using solely their smartphone.
We may all claim to hate banks, but they can be just as an important fixture on the high street as a butcher, greengrocer or bookshop — especially when it comes to attracting consumers to visit the area. More importantly, bank branches are crucial for small businesses, who need a physical outlet to pay money in.
A House of Commons Library paper stated last year: “On average, postcodes that lose their last-bank-in-town receive almost £1.6 million less lending over the course of a year – a significant and damaging drop in funding for areas that are already under commercial and economic pressure.”
One more Nationwide Building Society branch is unlikely to stem the tide. But I wish them luck.