Not one shared bank hub promised as lifelines on high street has opened

The country’s major high street banks have been warned by the financial regulator that they must make new-style banking hubs a ‘priority’ in the coming months. 

Such hubs, which customers of all the big banks can use, have been identified as the best way to keep banking services on the high street amid a rash of branch closures. Yet despite the banks agreeing to fund them, their roll-out has been excruciatingly slow. 

Although ten new hubs have been announced since December last year, none has yet opened. It means only two shared branches are currently in operation – in Cambuslang, near Glasgow and Rochford in Essex – and there’s a risk that these will shut next April when their future is reviewed. They were originally set up as pilots for the scheme. 

There are plans for ten shared banking hubs but not one has emerged so far. Like two oases, pilot schemes are up and running in Cambuslang and Rochford

While the organisation responsible for overseeing the introduction of banking hubs says it will announce ‘many more hubs over the coming months,’ the regulator seems to be unimpressed about the progress being made. 

On Friday, the Financial Conduct Authority (FCA) told The Mail on Sunday: ‘Firms need to pick up the pace and deliver more banking hubs. We expect this to be done as a priority.’

It added: ‘Banks and building societies must treat their customers fairly and provide alternatives to branches where needed. Banking hubs are one of a range of tools they can use to ensure communities have easy access to banking services and cash.’

Banking expert Derek French, a longstanding champion of banking hubs, welcomes the regulator’s intervention, accusing the banks of slowing down the opening of hubs to the ‘pace of a snail.’

The Post Office, which is lined up to operate these hubs, complemented by staff from all the big banks, says it has been ‘pressing for speedier progress for months.’ It adds: ‘The Post Office is ready to operate many more banking hubs and welcomes a push to speed up the selection and deployment process.’ 

The intervention by the FCA comes as the banks and the country’s biggest building society continue to slash their branch networks and reduce the opening hours of those branches that remain. 

So far this year, 433 branches have either been axed or put on notice of being shut for good – with the latest batch of closures disclosed this month by Barclays and Nationwide. 

Many of these closures mean that, distressingly, towns have lost their last bank. Experts believe a similar number of branch closures will be announced before the year is out. This will leave many people dependent on ATMs and local shops (through cashback facilities) to get cash – and post offices to do basic banking transactions such as deposit money or cheques. 

Help on more complex financial issues – mortgage queries, savings account problems or activating a power of attorney – will only be available online. 

Since the turn of the year, bank closures have been monitored by cash machine network operator Link as part of a new regime set up by banking group UK Finance and overseen by Natalie Ceeney of the Cash Action Group. Ceeney is a passionate campaigner for consumers having access to cash. 

Now, when a bank closes a branch, it must inform Link, which then assesses the impact on the local community’s access to cash. Working to strict rules laid down by the banks, Link can recommend that a free-to-use ATM is installed if the closure will curtail access. In communities where the closure will result in it becoming bankless, Link can also recommend the setting up of a hub.

It is then up to the Cash Action Group, chaired by Ceeney, to put a hub in place with funding provided by the banks. But so far, such recommendations have been thin on the ground and none have opened. 

Why are we still waiting? What is (or isn’t) happening at the ten sites 

1) Acton, West London 

Lost its last bank (Barclays) in June 2021. Offer from Cash Action Group (CAG) for a new hub accepted on a property, situated in a new-build shopping centre. Landlord needs to complete eight weeks’ worth of work before lease can be signed. 

2) Brixham, Devon 

Last bank (Lloyds) axed in September 2021. Offer from CAG accepted on a property, but awaiting outcome of asbestos report due to age of property. 

3) Carnoustie, Angus 

Lost its TSB branch last year, leaving it bankless. Only one suitable premise for a hub, but survey has identified a number of ‘structural and remedial challenges’ and an asbestos report is required. 

4) Knaresborough, North Yorkshire 

Last bank (Halifax) closed in February 2021. No properties available to accommodate a hub. 

5) Syston, Leicestershire 

Bankless since the middle of last year. CAG in negotiation with landlord of a property that has just come back on the market. 

6) Buckingham, Buckinghamshire

Lloyds to shut last bank in town next month. CAG hoping to use the premises for a hub. 

7) Cottingham, East Riding of Yorkshire 

Hub destined for Lloyds branch, due to close next month. 

8) Troon, South Ayrshire 

Bank of Scotland branch shuts next month. Offer on premises for a hub accepted – but asbestos survey required due to age of property. Hub design complete and builders on standby.

9 Welshpool, Powys 

CAG looking at suitability of two properties, plus Lloyds branch due to close next January. Barclays branch, shutting next month, deemed too small for a hub. 

10) Looe, Cornwall 

No properties apparently available. Assessing suitability of Lloyds branch, which shuts early next year. 

Of the 433 branches scheduled for closure this year and next, Link has only called for restorative action in eight of the locations impacted, five of which involve the setting-up of a hub. 

These five are in addition to five hubs announced last December. John Howells, chief executive of Link, admits the roll-out of new banking hubs is ‘far too low.’ Yet he is confident that discussions with banks over rules determining when a hub can be recommended could lead to some ‘positive news’ in the coming weeks. 

Last October, Derek French identified 50 towns where he thought banking hubs should be introduced urgently. Since the list was published exclusively in the MoS, only one of the towns (Knaresborough, North Yorkshire) has been earmarked despite the fact that many have either lost their last bank – or are about to. Howells says up to ten of the communities earmarked by French should be supported by banking hubs. 

All this is deeply frustrating. Particularly because of the ten new hubs proposed since last December, not one is currently up and running. 

A lack of suitable properties and necessary building work on premises already purchased by the Cash Action Group means it is unlikely that more than a handful will come on stream before the end of the year. In nearly all instances, there will be an unacceptable gap between the last bank in town closing and the new banking hub starting. 

Pressure: Natalie Ceeney

Pressure: Natalie Ceeney

Natalie Ceeney accepts the delays are understandable. On Friday, she told the MoS: ‘From a standing start in January, we’ve created a team including property experts, conveyancers, project managers and experts in everything from disability access requirements to planning law. 

‘We’ve established a new legal partnership with the Post Office to run the counters of these hubs and agreed the layout and design principles. We’ve worked with local communities to identify the right locations, and in all cases have been engaging with the local market to secure leases on properties.’ 

She conceded that not enough hubs and other cash services have been announced, adding: ‘However, over the next few weeks, we will be announcing many more. We are just at the start of this new initiative – in a few years’ time there will be hundreds of shared banking hubs on our high streets.’ 

Jenny Ross, money editor at consumer group Which?, says these services will take on an increased importance as banks shut branches at ‘an alarming rate’. Yet she believes access to cash will only be safeguarded if the Government carries out its promise to legislate on the issue. 

Under the new Financial Services Bill currently making its way through Parliament, the FCA will be empowered to ensure banks maintain reasonable access to cash on the high street through initiatives such as banking hubs. 

Ross adds: ‘Once the Bill is passed, the FCA should be ready to use its new powers to determine a local community’s access to cash needs and to hold banks accountable.’ 

The banks would not comment on the slow progress being made on banking hubs, referring the MoS to their trade organisation UK Finance. 

It said: ‘Whenever a bank branch closes, Link independently assesses the local community’s cash access needs and will commission any new services required, which can include a banking hub. Ten hubs have been announced since last December, with more to come, and the industry is fully behind getting these up and running as quickly as possible.’