'Banking plan does not add up as it stands'
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COMMUNITIES, businesses and public bodies must join forces to provide a whole-system response to meeting local banking needs.
This was among the recommendations of a study commissioned by Highlands and Islands Enterprise (HIE) amid a growing trend of rural bank branch closures.
There have been closures by the RBS in Aviemore and Grantown this summer and by the Bank of Scotland in Kingussie last year. In other areas customers have been left facing road and ferry journeys of more than 50 miles to get to a bank.
In 1989, there were more than 17,800 bank branches estimated to be operating in the UK. By the end of this year that number is expected to fall to fewer than 8000.
Some projections have suggested it could drop to as low as 600 branches in five years' time.
Between 2015 and 2018, 48 bank closures have taken place or are under way in the HIE area including 22 in the Highlands. Some of these are the last banks in their communities.
Consultants Indigo House Group said banking facilities need to be understood as core to community infrastructure.
It said access to cash remained fundamental to the viability of the small retail businesses that are prominent in rural areas. This is especially true in relation to tourism businesses where the loss of access to cash via local banks could have a detrimental effect on long term prospects.
Although there are potential alternatives, including online or Post Office banking and mobile bank vans, the report warned that these options raised concerns over such issues as cybersecurity, the fragile nature of Post Office contracts and accessibility of mobile banks for less able people. Customers facing a shift from a local branch to a mobile bank also consider this a backward step.
In its recommendations, the report calls for a collaborative approach involving Scottish Government, HIE, local councils, community members and delivery partners, including the banks and Post Office.
It also wants recognition of the importance of cash to local economies and support over time for a sustainable transition to digitally based economies. This includes the creation of digital inclusion strategies to help businesses benefit fully from online banking.
The report also recommended a Post Office banking strategy that would include securing the long-term sustainability of contract Post Offices to support rural economies and infrastructure.
* The full report is available at www.hie.co.uk/access-to-banking-services
