Three of Britain’s four largest banks have decided to work together in launching jointly-run mini bank branches for its business customers, the Financial Times reports. Lloyds Banking Group, Royal Bank of Scotland and Barclays opened the first “business banking hub” in Birmingham last 11 March with five more expected to launch in other cities including Manchester, Merseyside and Bristol.
Rampant bank closures during the past 30 years saw half the branches close, from 20,583 in 1988 to 9,690 in 2017, according to the Parliament Treasury Select Committee ,leaving many towns without high street banks. The Committee said it was up to the financial services industry to decide how best to preserve in-person banking, but options include mobile branches, sharing premises with competitors, or using community buildings to preserve a high street presence.
The banking hubs are specifically designed to enable businesses to pay in large volumes of coins, notes and cheques while completing cash exchange transactions. Currently being managed by G4S and Vaultex, it will have longer opening hours – from 8am to 8pm – to attend to its customers.
The concept is not new as it has been popular for some years, particularly in Latin America where cash management company Prosegur have been operating white label branches on behalf of banks.
According to the EY 2018 report on the future of SME banking, the total number of SMEs has grown over the previous decade and have played a crucial role in creating jobs. Approximately 16.1M employees in 2017 came from this sector, representing 60% of all private sector employment. Small and medium enterprises are the lifeblood of the UK economy and their banking needs are changing dramatically to which the banks, UK government and regulators need to adapt to accordingly. UK’s banking and finance industry committed to secure free access to cash while the British government is keen on protecting the future of cash.
“We have listened to what our business customers really want from our cash services. It is now more important than ever that we continue to offer innovative services, and we are creating an infrastructure that allows small business owners and entrepreneurs to do what they do best – run their business. I look forward to continue working with fellow banks to ensure the UK’s businesses are getting the support they deserve.”, says CEO of NatWest Holdings and CEO of NatWest Commercial and Private Banking, Alison Rose.
It’s clear that for certain SMEs that want to maintain cash-based banking services, a digital-only route would not cater to their best interests. Through this joined effort, businesses that manage cash and cheque transactions will be able to access a convenient and shared facility catering to their wants and needs.
It’s a deep concern that would affect society as a whole, and this goes to show that many would struggle to cope in a cashless UK society and that cash is more present than many of its critics would like to believe.