Banks

In the United Kingdom, banking islands in cash deserts

Two years after the closure of the last bank in Denny, a town in the south of Scotland, its 8,000 inhabitants have welcomed with open arms the installation of a kiosk which allows them to carry out their most basic operations.

A counter, an ATM, two tablets and two advisers: the kiosk of the OneBanks startup installed in a Co-op supermarket represents an alternative to traditional agencies at a time when these are closing with a vengeance, victims of internet and cost hunting.

Donna Corrigan, 40, shows up with a heavy box of coins to deposit into her account. Behind the Plexiglas counter, a counselor engulfs the handles of scrap metal in a machine while making conversation.

Here, you can withdraw or deposit cash or pay your bills regardless of your bank, thanks to the application developed by the company. Real life advisors also help the less tech-savvy with online banking.

When the banks closed in Denny, “you had to drive 20 minutes” to find an establishment nearby, says Ms Corrigan.

Half of the country’s 10,000 agencies will disappear between 2015 and the end of 2022, and Scotland is the region most affected, according to the consumer association Which?.

– Addicts –

The rise of online transactions is leading banks to cut corners on a less used banking network. In the neighboring euro zone, the number of branches fell by 20% between 2016 and 2020, according to the European Central Bank.

Some countries are more affected than others: in the Netherlands, 44% of agencies will have closed over this period, compared to 13% in France.

Yet large swaths of the population are still completely dependent on cash: almost 20% in the UK, estimates a study by the Royal Society of Arts (RSA), which describes a rather elderly, rural and peri-urban population. .

In the neighboring town of Bridge of Allan, 5,000 inhabitants, it is around noon and it is rush hour. The main street comes alive with customers who invest restaurants, cafes, bakeries and shops. Not a bank in sight.

The last “closed about 4 years ago,” laments Jennifer Wilson, who runs a hardware store, where 40% of turnover is still in cash.

The manager can deposit part of the receipts and make change at the local post office. But it is often very busy and she then has to drive half an hour to get to Falkirk… where her bank will also soon be closing the iron curtain for good.

– “Cold and sterile” –

There were once “three banks in this village”, recalls Richard Kilborn, a 79-year-old resident, who had to get used to online transactions but regrets human contact. “Everything has become cold and sterile”.

For the poorest who don’t have a car, the problem is sometimes daunting: you have to take buses, even take days off, which cuts into income… A real vicious circle.

British authorities are now asking establishments to assess the impact of branch closures on consumers and possible alternatives.

Major banks such as Barclays, HSBC, Lloyds or NatWest have recently agreed to fund alternatives together, and the country’s main ATM network, LINK, is tasked with assessing situations on a case-by-case basis. .

Several options have been tested, including the kiosk as in Denny, but also improved post offices, withdrawals from merchants or even two “banking hubs”, installed in the premises of the Post Office group, which see bankers from the main establishments of the country take turns during the week to welcome customers.

Given the success of the pilots, five new “banking hubs” have been announced and OneBanks, which currently has three kiosks in Scotland, plans to install fifteen more in the country.

The startup plans to expand internationally. Banking deserts “are a global problem”, argues founder and boss Duncan Cockburn. The use of “cash will continue to decrease, but it will take a long time for it to completely disappear”.

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