Community Bank Closures — House of Commons, 2018-02-08
Topic: Domestic Commerce
Philip Wilson (Labour, Centre-left): The hon. Lady makes a valid point. There has to be a social conscience in banking, and it should not just be for the public sector to sort out. The private sector has to be part of it We cannot deny the growing trend in banking being done online and by mobile phone and telephone. Barclays pointed out to me that on average its customers use mobile banking more than 28 times a month and visit a branch less than twice a month. The bank carries out 12 digital transactions a second and, since 2014, has started to use video banking The way we bank is changing, and it is not just a UK phenomenon; it is happening across mainland Europe, too. According to data from the House of Commons Library, by the end of 2016, the number of bank branches in Germany had fallen to something like 32,000, which was a reduction of nearly 6% on the year before. In France, where there has been more robust opposition to branch closures—apparently, it is more difficult to close branches in France than elsewhere—Société Générale has announced the closure of 20% of its branch network by 2020. That bank is going to close one in five branches. However, the French bank branch network is still extensive, with six branches per 10,000 head of population, which I believe is the highest proportion in the EU. In Spain, 10,000 branches were closed between 2012 and 2016. Banking is changing, driven by technology that is obviously convenient to the vast majority of customers I would like the Minister to address two areas of concern. First, what more can the Government do and what work are they undertaking with the financial sector to encourage banks to look after their vulnerable customers so that they are not left behind? There is also a wider concern. Rural areas, such as County Durham, are seeing the destruction of rural bus services and there are issues with whether broadband provision is sufficient to allow customers to access the internet and therefore access online banking in the first place Secondly, the closure of bank branches highlights a key problem that faces our town centres. For example, the future of Newton Aycliffe town centre has been controversial for many years. Although Freshwater, the shopping centre’s owner, has invested in the centre and won awards for its efforts, the closure of two bank branches will only add to the number of already vacant shops. This is not a story reserved for Newton Aycliffe; it is true of town centres throughout the country. Town centres need to be more leisure-focused, with bars, restaurants and coffee shops, as retail moves online, where people are more likely to shop—with Amazon being a case in point. As a consequence, we see many retailers quitting jobs and issuing profit warnings. I make this request to the banking sector: look at how you can change your offer on the high street; look at how you can make the physical bank presence more affordable and more accessible; and look at whether there is a way to merge banking with leisure, such as, for example, placing bank branches within a café The closure of banks does not happen in isolation. It affects vulnerable people, it affects our town centres and it affects our communities and their way of life. The banks must remember that, although there is a trend with new technology towards online banking, other people can be left behind; and there is a life that is offline as well as online. All I ask is for the banks to think creatively, because they, too, have a social obligation to their customers, not just to their bottom line.