FSU argues moves shortsighted as demand will return after pandemic
The general secretary of the Financial Services Union (FSU) has called on banks to stop using Covid as an excuse to fast-track high street closures.
Speaking exclusively to the Belfast Telegraph, John McConnell said fewer bank visits during the pandemic are not illustrative of dwindling demand, but rather a reflection of restrictions.
He said closures not only affect “shades of communities” who have no access to digital banking but often see the withdrawal of hole-in-the-wall facilities too.
“It’s opportunistic to put closure decisions down to customer behaviour and attendance patterns when everyone was trying to adhere to restrictions during Covid,” he said.
“Surveys show that people would return to branch banking when the pandemic ends.”
He called for banks to pause closure activity.
Earlier this year it was revealed more than half of all the branches operated by the main banks here had shut in the last decade.
In March, 15 Bank of Ireland outlets were lined up for closure, meaning the total number of ‘big four’ branches will be 114, compared to 236 in 2010.
AIB announced in the summer it will close eight of its local branches in November, leaving it with just seven. And around the same time Danske Bank revealed it would close four branches.
The bank said the decision was taken after a strategic review which saw a 33% dip in the number of customers using its branch network and a 52% increase in digital online payments since the end of 2017.
AIB said the pandemic had accelerated a trend for customers to move away from using branches but that it would continue to offer a full service.
Brian Gillan of AIB said: “We assure customers that we remain fully committed to them and to Northern Ireland, providing them with a full service personal and business banking offering alongside an enhanced focus on both business and mortgage lending.
“Our priority is to ensure the bank has a sustainable future, which allows us to support our customers and play our part in strengthening the wider economy.”
But Mr McConnell said consumer behaviour during Covid shouldn’t be relied upon and he called for banks to pause closures.
“We’re not opposed to change but the change is moving ahead of where people are at,” he said.
“We are not at the digital maturity that the banks think we are. We’re not in the upper quartile of digital maturity in Europe, we are in the fourth, but banks are treating us like we are far more advanced.”
He added closures will damage smaller businesses who rely on built-up relationships with banks and their staff.
“There is a House of Commons paper that shows lending to the SME sector when a branch closes drops by 64%,” he said.
“People are resilient, and they can adapt to change, but the change to online banking has to be gradual rather than radical.
“Banks have a societal role; they make profits from communities and in both jurisdictions — North and South — they have been bailed out by taxpayers. Their workforce also continued to work during the pandemic, maintaining a service in the community, so we would ask for a slowdown.
“They can’t take a drop in footfall and use that as the logic behind closing banks. That puts the onus on customers.”