A number of bankless towns up and down the country could soon benefit from a new style shared bank branch on their High Street, having previously been ruled out for one.
The move will be welcomed by many bank customers, especially the elderly and small businesses, who prefer to do their banking face-to-face — or need to deposit takings on a regular basis.
Towns now potentially in line for such a bank — which customers of all major banks can use to deposit and withdraw cash — include Windsor in Royal Berkshire.
In August this year, this busy town, attracting thousands of tourists every day, lost its last bank when Barclays shut its branch on the corner of the town’s High Street, directly opposite the castle.
Other bankless communities that could benefit include Harpenden in Hertfordshire, Tonbridge in Kent and Melksham in Wiltshire.
Closures: Since the start of last year, more than 1,150 branches have either been shut or put on notice of future closure, leaving dozens of communities without a bank
Experts believe at least 27 towns could now get a shared branch — often known as a banking hub — after being denied one.
This boost for High Street banking in so-called ‘banking deserts’ is a result of a reorganisation of Cash Access UK — a not-for-profit company set up last year to install shared bank branches in towns where the banks have closed all their premises.
Since the start of last year, more than 1,150 branches have either been shut or put on notice of future closure, leaving dozens of communities without a bank.
Today, Cash Access UK will confirm that Nationwide will no longer be one of the nine financial organisations that provide it with funding to open the new hubs.
Nationwide’s decision is based on the fact that it should not be contributing towards building a network of hubs when it is not benefiting from the savings resulting from branch closures.
A typical bank branch costs £300,000 a year to run, compared to £250,000 for a hub — a cost divided across all banks.
Having just undergone a major rebrand, the building society wants to focus its resources on promoting its 605 branches which it is committed to keeping open until at least 2026.
With all the major banks having slashed their branch networks, Nationwide now has the most branches among all the lenders and wants to capitalise on this to increase new business. Its TV ad campaign, starring Dominic West, lampoons the archetypal self-entitled bank boss.
Banking hubs: Towns now potentially in line for such a bank — which customers of all major banks can use to deposit and withdraw cash — include Windsor in Royal Berkshire (pictured)
Hooked up: Other bankless communities that could benefit include Harpenden in Hertfordshire and Whitstable in Kent (pictured)
When Nationwide withdraws, Cash Access UK will be freed up to install hubs in towns where all the banks have disappeared, but the building society remains.
The current agreement prevents this, resulting in towns with a remaining Nationwide branch not benefiting from a hub even though the building society — unlike mainstream banks — does not offer banking services to small businesses, clubs or charities.
Many small companies need to deposit cash and cheques, which a hub allows them to do. In recent months, banking expert Derek French has called for this anomaly to be addressed.
His home town of Harpenden does not qualify for a hub because of Nationwide’s presence.
He believes today’s announcement by Cash Access UK could now see towns like Harpenden get the hub they need.
John Howells is chief executive of cash machine network Link which decides which towns qualify for a hub.
He told Money Mail that many ‘big towns’ previously denied a hub would now likely qualify for one. ‘Our view is that a number of the bigger towns do need banking hubs to support the existing Nationwide branch, post office and ATMs.
‘We will work urgently with the banks to amend the criteria we use to bring a number of these larger communities into scope.
‘We have also asked Cash Access UK to be prepared to add a number of locations to its banking hub opening programme.’
So far, ten banking hubs have been set up countrywide, although 92 have been sanctioned by Link.
Gareth Oakley, chief executive of Cash Access UK, says: ‘One of our founding firms Nationwide has decided that from January 2024, they plan to serve their customers through their own branches.
‘We still look forward to having hubs open in 30 communities by Christmas, and 60 more opening next year.
‘Our member banks and Link will now work together to consider any impact on cash provision in communities as a result of the building society’s decision.’
Nationwide customers will still be able to use hubs, but only to withdraw cash and get an up-to-date account balance.
Nationwide says: ‘We are investing in — and have — the largest branch network in the UK.
‘We remain committed to ensuring our customers have access to cash and face-to-face services on the High Street. We hope banking hubs thrive across the country by providing services to underbanked communities.’
Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.
