High Street Banks and Banking Hubs

Lord Rogan Excerpts

Thursday 25th January 2024 Lords Chamber

[Lord Rogan (UUP)]

My Lords, I congratulate the noble Baroness, Lady Tyler, on securing this important and timely debate. The issues she raises are UK-wide, but your Lordships will understand if I concentrate my remarks on the situation in Northern Ireland, which has a large rural community affected by these closures. But, as we know, this situation also affects urban dwellers and customers just as much.

In Northern Ireland, more than 50 bank branches have closed since 2020, and that number is set to grow again this year. Next month, Barclays will close two of its remaining branches in the Province: one in Newry and one in Coleraine. February will also bring the first of 10 planned Ulster Bank closures, when the Ormeau Road branch in Belfast shuts its doors. Over the next two months, two more will close in Belfast, together with branches in Ballynahinch, Crumlin, Downpatrick, Glengormley, Lisnaskea, Lurgan and Londonderry. Halifax also plans to close its branch in Larne in May.

This seemingly endless round of closures is having a profound and detrimental impact on community life in Northern Ireland, especially in rural areas and on older people who have spent a lifetime banking in person. When banks close their branches, their free ATM services are generally casualties as well. As in Britain, trying to find a high street cashpoint in Northern Ireland is often the worst kind of treasure hunt, with a minimal chance of finding gold at the end of the rainbow. More often than not, the only ATMs available are in shops or stations, where a charge is often levied for even the smallest withdrawal.

I understand the dash towards a cashless society, the pace of which was most certainly quickened with the arrival of Covid-19. But surely some modicum of common sense must prevail—particularly, again, when it comes to older people, including my wife and I, who have spent a lifetime with the comfort of having cash in their pockets and are not about to change their habits now. Internet banking is simply not for everyone, particularly those of us of a certain vintage.

Not so long ago, and certainly when I was a young man opening my first bank account, in small rural towns and rural areas of Northern Ireland the local doctor, the principal of the local school and the local branch manager were all pillars of civil society. They knew you and your background, and you could go and speak to them personally. When you needed a mortgage or wanted to have an overdraft facility, you simply applied for an interview with a local branch manager. Often, having explained the situation, a decision could be made that very day, and, if not, the request was sent up to headquarters in Belfast and a decision was taken in the next four or five working days. This personal contact is lost to impersonal automation.

The noble Baroness, Lady Tyler, rightly references in the title of her debate the desire for a national network of banking hubs. Although they may not deliver the quality of service of local bank branches, they are better than nothing, which is what many small communities in Northern Ireland have, sadly, been left with. Just last month, the Province’s first-ever banking hub was opened in Kilkeel, County Down. Operated by a non-profit firm, Cash Access UK, it offers a Post Office counter service that allows customers of all major banks to carry out regular cash transactions. Five different local banks are rotating, with a different branch available each weekday, allowing customers to talk to their own bank in a dedicated meeting room. I understand that four more banking hubs are expected to open in Northern Ireland, in Comber, Warrenpoint, Portrush and Newcastle. This is welcome news, although it will still leave large parts of the Province without in-person banking facilities. To illustrate, until the hub opened at Kilkeel in December, customers seeking counter service had to travel around 40 minutes to Newry, Downpatrick or Castlewellan.

I warmly commend Cash Access UK, which is owned and funded by nine major high street banking providers, for opening these hubs in Northern Ireland. I hope that many more will follow. The company rightly acknowledges that up to 6 million adults across the UK still rely on cash in their everyday lives, and it has vowed to work with a growing number of communities to meet their cash and basic banking needs.

I ask the Minister to give an insight, in her closing remarks, into what His Majesty’s Government are doing to ensure that Cash Access UK is receiving the support it requires to provide high-quality banking services, and, more importantly, to ensure that it is able to significantly expand the number of hubs it operates. That particularly applies to Northern Ireland because, although having five banking hubs by the end of this year is incredibly welcome, there is clearly a need for many more if communities, especially rural ones, are not to be left behind.