Banks

(asked on 28th August 2020) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps his Department is taking to encourage the provision of mobile bank branches.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 8th September 2020

The branch strategy of individual firms may be driven by a variety of factors, including customer interests, market competition and other commercial considerations. These are commercial decisions for firms and the Government does not intervene in this decision-making.

Throughout the Covid-19 pandemic, the Government has been working closely with the financial regulators, banks, building societies and credit unions to ensure they continue to maintain branch access for essential services while balancing the needs of their customers with the safety and welfare of staff. Though many firms have reduced their opening hours the vast majority of branches have remained open for customers. Furthermore, several retail banks have put in place solutions for vulnerable customers, including enabling them to make payments through a trusted person or have their cash securely delivered to them at home. Many firms have also set up dedicated phone lines so these customers can speak to their provider as quickly as possible.

The way consumers interact with their banking is changing. In recent years, over two-thirds of UK adults have used contactless payments and online banking and nearly half have used mobile banking, according to UK Finance. As a result of the pandemic, many customers may have used these channels for the first time. However, the Government still firmly believes that the impact of branch closures should be understood, considered, and mitigated where possible so that all customers, wherever they live, continue to have access to over-the-counter banking services if they wish to use them. That’s why the Government supports the industry’s Access to Banking Standard which informs customers of the bank’s reason for closure and helps customers to understand the options they have locally to continue to access banking services.

The Post Office also allows 95% of business and 99% of personal banking customers to carry out their everyday banking at 11,500 Post Office branches across the UK. Customers have been able to use the Post Office for essential banking services as an alternative to their branch throughout the pandemic. Customers can also use ATMs or cash machines as normal for cash withdrawals and balance enquiries.

In July 2020, the regulator the Financial Conduct Authority published draft guidance setting out their expectation of firms when they are deciding whether and how to reduce their physical branches or the number of free to use ATMs. Firms are expected to carefully consider the impact of a planned closure on their customers’ everyday banking and cash access needs, and other relevant branch services and consider possible alternative access arrangements, which may include mobile branches. This will ensure the implementation of closure decisions is done in a way that treats customers fairly.

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