A community in Essex is fighting back against the banks that have cynically abandoned it – with plans to open the country’s first shared branch. The 18,000-strong town of Rochford saw its last bank close three years ago when Barclays pulled out. A year earlier NatWest quit the community while previously Lloyds turned its back on the town.
But this proud market town has now been thrown a lifeline. It has been identified as the best candidate out of eight ‘cash pilot’ schemes chosen to test new ways of ensuring that hard money – rather than just plastic – remains freely available to both consumers and businesses to use on the high street.
This autumn, locals intend to open a shared community bank in one of the still boarded-up premises once occupied by NatWest and Barclays. It will mean customers of all the major high street banks will once again be able to withdraw and deposit cash.
Demand: Butcher Jason Macaree says half his customers want to use cash
It is part of a ‘community access to cash pilot’ launched by former boss of the Financial Ombudsman Service Natalie Ceeney. This follows the publication of a Government-backed Access to Cash Review she wrote last year – setting out the desperate need for people to have access to cash.
COMMUNITY’S FURY AT BEING ABANDONED
Rochford District councillors Craig Cannell and George Ioannou are spearheading the shared bank initiative – and have a wealth of banking and technology experience to push through the plans.
George, 59, is a retired director of financial credit ratings agency Standard & Poor’s while 30-year-old Craig is a former online banking analyst who now develops mobile phone apps for a living. Craig says: ‘Our community is furious at the way banks have treated us. We will no longer accept lame excuses and are certain a shared branch can work in Rochford.
‘We have the know-how and skills to ensure it will thrive. Being chosen to be part of this cash pilot scheme gives us the necessary initial funding to set the system up.
‘We can even run it without the banks’ full blessing – we just need them to be forced to sign up to this deal.’ Initial funding of £100,000 is expected from the scheme organisers for Rochford – money that high street banks have been made to hand over. The aim is for the branch to open this September – and hope fully to become a full-time outlet after a six-month trial.
George says: ‘As chair of the local chamber of trade, I am delighted that every local business is foursquare behind this exciting new project. An empty branch is being earmarked to house this new community bank hub.’
The businesses are responding to calls from locals desperate for a new banking service. Jason Macaree, 49, owner of town butcher J Mac Meats, says: ‘The banks keep telling us all to bank online – but only because it saves them money and not because it’s what people always want. For my business, about half the customers still insist on using cash.’
Naime Alagoz, who runs Annie’s Coffee Shop and Sandwich Bar, collected more than 2,000 signatures four years ago in a fight against NatWest’s branch closure – but to no avail. There is now only a post office counter at the back of a Martin’s newsagent to handle people’s financial needs – plus an outside Cashzone cash machine that charges 99p every time you withdraw money.
Naime, 59, says: ‘The number of customers coming through my door fell by half after the banks abandoned us. It is the same for many other shops. This is about the survival of our high street and our community – not just access to cash.’
SCHEME IS LAST CHANCE FOR A SHARED BANK
Penny-pinching banks are still dragging their feet over the shared branch idea. They would prefer to install a free ATM in a local shop as an alternative ‘cash pilot’ solution. This year cash machine network group Link pledged £5million – coming from bank members – to install 250 ATMs nationwide.
Link admits this could be used to support the pilot scheme. A Link spokesman says: ‘We will have a clearer idea on solutions over the next few weeks.’
Former Financial Ombudsman Service boss Natalie Ceeney has yet to confirm the shared branch will open – though she says it is a distinct possibility.
She says: ‘It is perfectly feasible that a shared bank branch could work and there might well be justification for providing one in Rochford.’
Derek French is former director of the Campaign for Community Banking Services, an organisation that argued for shared bank branches in the early 2000s.
He says: ‘Rochford, out of all the candidates, has the strongest case for having a shared bank branch. Banks have used every trick in the book to avoid trialling shared banking hubs.
‘This pilot scheme provides a last ditch opportunity to make something happen.’
More than 7,000 cash machines have been removed from high streets since the coronavirus lockdown in March – and there are now fewer than 50,000 free-to-use ATMs nationwide. Over the past decade, more than 6,000 bank branches have closed – reducing the network by a third.
This has led the Government to pledge to introduce legislation requiring banks to provide access to cash – and support for the pilot scheme.
The cost of rolling out a network of shared branches has been estimated at about £20million a year. Banks currently spend £700million a year keeping open loss-making outlets and ATMs. A spokesman for banking industry trade body UK Finance says: ‘We are committed to ensuring access to cash remains free and widely accessible – and understand there is no one-size-fits-all solution.
‘Solutions include helping local communities identify non-ATM cash access ideas.’
OTHER PLANS TO KEEP ACCESS TO CASH
Ron Delnevo, director of the ATM Industry Association, is launching a new cash pick-up service in September to help keep ready cash freely available.
Using the Swiss payment service Sonect, it will enable people to order money via a smartphone app to collect at a local high street shop. Initially, he hopes to trial the idea in the Midlands before rolling it out nationwide.
He says he’s worried shared bank branches will never happen ‘as banks do not want them’.
He explains: ‘If they did, they would have been introduced by now. I’m also concerned for the future of cash machines if it means banks have to pay to run them. This is why I am backing this new cash pick-up service.’
Delnevo not only wants the Government to keep its pledge of ensuring banks and building societies provide access to ‘free’ cash – but that this is reinforced by guarantees that shops accept banknotes and coins as well.
Delnevo points to a ‘payment choice bill’ being proposed in the United States as a benchmark to follow. This would make it unlawful for a shop not to accept cash if this is how a customer wanted to pay.
He says: ‘It is appalling how shops are refusing to take cash on so-called ‘safety’ grounds – with high street retailers pushing people towards contactless payments.
‘There is no proven link between cash and the pandemic. Shops are just using it as an excuse for their convenience.’
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