High Street Bank Closures and Banking Hubs

Elliot Colburn Excerpts

Thursday 11th May 2023 Westminster Hall

[Elliot Colburn (Carshalton and Wallington) (Con)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate my right hon. Friend the Member for Aldridge-Brownhills (Wendy Morton) on securing today’s debate and on an excellent opening speech, which set the scene as to why community banking is still so important. It is also a pleasure to follow the hon. Member for Barnsley East (Stephanie Peacock).

The matter we are discussing is indeed very important. A lot has been said about rurality and access in more rural areas, but even in suburban towns such as Carshalton and Wallington, just outside London, this is proving to be a difficult issue. The main high street in Carshalton no longer has any banking facilities left whatsoever. There is a post office, but all the high street banks have left; I think Barclays was the last to leave, and that was quite a few years ago. The high street in Wallington lost Halifax a few years ago, and it has just been announced that Barclays is closing its branch on the high street as well. Of course, people can vote with their feet and switch to another bank that has a high street presence; Wallington does still have a NatWest, a Nationwide, a TSB, an HSBC and a Santander. However, the worry is that the Barclays branch will not be the last closure, and that many if not all of them will eventually close. As my right hon. Friend the Member for Aldridge-Brownhills said, at this rate of change, the next few years could see the end of high street banks altogether. We have seen it in other parts of the London Borough of Sutton, too: Cheam village, for example, has no high street banks left, having lost four over the course of the past decade.

In my short contribution today, the question I want to touch on is what is left behind when banks decide to close? Of course, the nature of banking is changing, and I respect that tough business decisions need to be made around the future model. However, as the hon. Member for Barnsley East mentioned, it is a huge issue that many people, for a number of reasons, are excluded from digital participation in online banking, and the same is true of those who rely on cash transactions, be they small businesses, charities or individuals. It is important that there is a left-behind service for them.

I thank Barclays for being very constructive in engaging with me since its decision to close. It has agreed to set up a Barclays van for customers, which will be in the car park of Dobbies Garden Centre—no relation to the house elf—twice a week every fortnight, on Tuesdays and Saturdays, I believe. It has also agreed to retain a single member of its staff so that it has a presence in another location on Wallington high street five days a week. That is very welcome news. I welcome the fact that Barclays realises that it needs to leave something behind, but that is sadly not always the case when other banks decide to close. They simply point to ATMs or the post office in the area, but as my right hon. Friend the Member for Aldridge-Brownhills pointed out, access to cash and ATMs—particularly free ATMs—is also in decline.

There is a big problem with an over-reliance on the Post Office, which is not without its own problems. The post office in Wallington often has massive queues stretching up the road, particularly on a Saturday, and its opening hours are a lot more restricted than those of a bank. Over-relying on the Post Office to provide a banking service to people once a branch decides to close is wrong; we need to take a more holistic view.

I absolutely support the idea of banking hubs. It is a great idea to have representatives from all major high street banks in one place. It is a way for the banks to save money on rent for buildings that are not being used as well as they could be, so it is a good deal for banks and customers. However, I worry that they are often considered only when everything is lost. They can take a long time to set up from scratch, so potentially absolutely nothing will be in place for years. Will the Minister outline whether the Treasury will consider using its convening power and its influence to persuade banks to work more collaboratively and holistically to look at community need and plan in advance for these things to happen? We should not wait for every high street bank to close and then try to set up something from scratch. That is probably the best way forward.

We all understand and appreciate that the nature of banking is changing, but for so many—not least those who are digitally excluded—having that in-person service is not only desirable but vital. I hope the Minister will outline what work the Treasury is doing and will continue to do to ensure banking remains fair and accessible for everyone.