Carnoustie to be site of new landmark bank scheme

The new hope for high-street banking, funded by the banking industry has come in the form of brand new multiple-banks-in-one hub hosted by the Post Office.

Among the banks supporting the move is Edinburgh-based TSB that has either shut or is shutting over 140 bank branches across the UK over two year with Scotland the hardest hit.

It is understood £4m has been made available immediately, which could support 20 hubs across the UK - but with more money expected to be pumped as more are required.

The collaboration, achieved through the Access to Cash Action Group (CAG), marks the beginning of what the body described as a "long-term commitment" to ensuring widespread cash and banking access for communities where services are limited.

It comes after a successful shared banking hubs pilot in Cambuslang, Glasgow and Rochford, Essex as part of the Community Access to Cash Pilot programme.

The Herald understands that Carnoustie is to be the first to benefit from the roll out of the bank hubs.

A wave of TSB branch closures last year left Carnoustie without a single bank in the town.

In October it emerged the Post Office said it would look at all options to keep a branch open on Carnoustie High Street - amidst concerns that the present services at a Spar store were to disappear early next year.

Dundee-based operator CJ Lang's lease on the shop expires in January.

The Carnoustie branch was one of 73 TSB bank branches due to be axed in Scotland as part of an announcement made by Edinburgh-based TSB in January. It meant a cut of around 300 jobs despite appeals to save branches in remote and most deprived areas of Scotland.

Last month TSB announced it was axing a further 70 bank branches next year, including nine in Scotland, putting 150 jobs in a new wave of cuts.

The new bank hubs have emerged as it emerged that Scotland has seen more branches shut down in the past six years than have remain opened.

A new analysis produced exclusively for the Herald on Sunday by the consumer organisation Which? has revealed that 54% (554) of the 1019 bank branches that existed in Scotland in 2015 will have shut by early next year.

The consumer organisation Which? has been urging banks to prove they can take effective action to stop people losing access to cash and valued bank services without adequate alternatives being ready to put in place - or pause their branch closure plans until the government legislates to protect cash.

It comes as cash use has been in decline in recent years – a trend accelerated and exacerbated by the pandemic – with current use 35% below pre-Covid levels.

But millions of people across the UK still use cash daily.

Recent research from the Financial Conduct Authority found that, during the pandemic, 15% of UK adults have struggled to cope without access to bank branches and ATMs, while 16% suffered as more businesses stopped or encouraged customers to use contactless or digital payments.

FCA research suggests that five million people remain dependent on cash.

In January, research showed that over 2m Scots were refused payment with notes and coins during the pandemic, threatening the viability of the cash network.

The CAG say that banks and consumer groups alike recognise the need to ensure that consumers and small businesses who need cash can continue to withdraw and deposit it.

Under the new model, any community that faces the closure of a core cash service, such as a bank branch or ATM, will have its needs independently assessed by the overseers of the UK's main cash machine network, LINK - as CAG’s dedicated, coordinating body - for a suitable solution to be provided.

LINK says it will commission services to meet the cash needs of the community as a whole – not just the customers or members of one bank or building society.

Communities will also be able to request a review of their community’s needs from the summer of 2022.

LINK says it has already assessed most communities where closures have taken place over the past year.

As a result it is pushing ahead with new services in 2022, with announcements of further services to come in early 2022.

The banking hubs will be launched alongside a 'cashback without purchase' scheme which is being rolled out to some 200 shops across Scotland by the end of the year in a bid to retain the public's right to access hard cash.

The solution means consumers can make a cash withdrawal of up to £50 and check their balance without needing to make a purchase Natalie Ceeney, chairman of CAG and the Community Access to Cash Pilots said: “I’m delighted that the industry is today committing to ensuring that the cash needs of consumers and small businesses up and down the UK will continue to be met.

"We know that demand for cash is declining, but we also know that it continues to play a vital part in the lives of at least 5 million people in the UK – including some of the most vulnerable in society.

"The community pilots have shown that there are many different ways to meet people’s cash needs. Informed by this experience, I’m confident that the new plan will lay the foundations for a positive future for cash access across the UK.”

Data provided by LINK revealed that the number of ATMs dropped from 5,866 in November, 2019, to 5,239 in September last year. There were 4022 free-to-use cash machines across Scotland while 1,217 charged - meaning that in one in four of the nation's ATMs you had to pay to get your money out.

Caroline Abrahams charity director of Age UK said: "This is arguably the most promising development we've yet seen in ensuring that older people can continue to access cash, which so many of them rely on as an essential part of their everyday lives. It's been great to be part of the Cash Action Group and we look forward to seeing the principles agreed by the Group translate into action across the country, and really starting to make a positive difference for many older people."

Banks have signed up to the new approach and will contribute to funding from 2022 onwards. But it was not immediately clear how much money was being committed and how many bank hubs were being rolled out.

Those taking part include Barclays Bank UK plc, Danske Bank, HSBC UK Bank plc, Lloyds Banking Group, Nationwide Building Society, NatWest Group plc, Santander UK plc and TSB Bank plc.

David Postings, chief executive of banking trade body UK Finance said: “The banking and finance industry is committed to maintaining access to cash for people who need it, when they need it.

"UK Finance is delighted to have played a key role in the work, which has led to today’s announcement of a collective commitment to meet the needs of both personal and business customers who rely on cash.

"With demand for cash projected to continue to decline, the way access to cash is provided will have to continue to evolve. This new approach, with an independent co-ordinating body at its heart, means that we now have a joined-up response to meeting communities’ cash needs well into the future.”

John Howells, chief executive of LINK added: “Our relationship with cash is changing but the UK is not ready to be a cashless society and free access to cash remains vital for many consumers and communities. LINK is therefore delighted to take on such a key role working with the banks to ensure that the cash needs of communities continue to be met.”

SNP MP Ronnie Cowan said - "It is good the hear that Link and the major high street banks are working together to find constructive solutions when it has been identified that a bank closure would result in the loss of the last free to access ATM in the immediate area.

"Without a bank then we must consider the provision of an ATM either through a Post Office or other outlet and if appropriate then a bank hub as per those already piloted must be considered."