Banks must revive high street branches – or risk becoming obsolete


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For many consumers and small businesses, dealing with the bank has become a nightmare, writes city editor Alex Brummer.

Branches are disappearing from local shopping streets so quickly that they are creating financial deserts. It is devastating for the elderly, the infirm and the small businesses that are still part of the monetary society.

More than 5,000 bank branches have closed since 2015, leaving customers with no choice but to drive several miles to the nearest branch or try to navigate useless phone lines, with the possibility of be suspended for 30 minutes or more, or go online. .

Since many of the closed branches are in rural areas or small towns, this in itself is its own problem due to unreliable Wi-Fi signals and slow connections.

That’s why it was such a relief that Debbie Crosbie’s (formerly of the TSB) first act upon taking up her post as chief executive of mutual building society Nationwide was to promise that for at least two years, the branch network would remain intact. Indeed, Nationwide has embarked on the renovation of several of its 700 branches and has made an effort – begun during the pandemic – to divert telephone calls from a switchboard to local branches where co-workers who man the tills know customers.

The devaluation of bank branches among the major banks is aimed at maximizing profits. Even on the main streets and in the communities where they remain open, the staff are far less expert than before. Simple concepts such as “family trusts” are unknown to staff and qualified help is impossible to find. When it comes to online banking, for many less technically inclined people, navigating security checks has become a complex task. But not doing so increases the risk of fraud.

In an age of anonymity, poor customer service, and automated attendants, customers have become second-class citizens for most banks.

These financial groups such as Nationwide and the Swedish competitor Handelsbanken UK – present in many cities – offer an excellent alternative choice to the big four players: HSBC, Barclays, NatWest and Lloyds.

New entrants, such as Metro Bank, have demonstrated that a combination of new branch technology, 7-day opening and longer hours can be extremely attractive.

The big four have to be careful what they wish for. As soon as they embrace online banking, their artificial intelligence, code writing, technology and mobile apps will never be as good as those of the Silicon Valley giants.

Apple and others are heading into traditional banking territory. Apple launched a buy it now, pay later (BNPL) app and parted ways with former banking partner Goldman Sachs, which offers billions of consumers an alternative to traditional credit card financing. Amazon is giving its “marketplace” businesses smoother access to credit. Wise offers its customers much cheaper currency exchange services. Unless branches are revitalized and services resumed, traditional banks could become increasingly obsolete.


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