Thursday 10 November 2016
Guidelines setting out how high street banks decide to close branches and communicate them to the public should be shorter but more focused, according to an independent evaluation of closure protocols.
A review of the Access to Banking Branch Closure Protocol says that banks are making the decisions to close branches correctly but they could significantly improve the way they communicate that to and engage with their customers and stakeholders affected by them.
The review of the Access to Banking Protocol one year on from its introduction, carried out by Professor Russel Griggs OBE, shows banks tried “very hard” to consider customers’ needs and implement the Access to Banking Protocol correctly, but recommends that significant improvements can be made.
Professor Griggs has made a number of recommendations to turn the Access to Banking Protocol into a much more focussed document that sets out simple outcomes that the banks have to deliver when closing a branch and on which they can be monitored.
Recommendations include:
Individual banks should make it clearer on how the decision making process operates within each of them.
On the Impact Assessment, which the banks have to produce for each closure Professor Griggs has several recommendations including:
Impact Assessments should be spilt into two parts with the reasons for closure being available the day the bank announces it is closing the branch and the second part being published once the bank has finished its post announcement engagement with customers and stakeholders which sets out what issues were raised and what the bank has done to mitigate them as far as it can given that not all will be possible.
Further recommendations are:
Banks, where possible, should engage with customers and stakeholders as soon as they have made the decision to close a branch and not wait until 12 weeks before which should be the minimum standard not the norm.
In terms of small business customers banks should work with them to see how they can mitigate further the real challenge of cash deposits and collection that closures bring to some of them.
Banks examine how they can better engage with their older customers when a branch closes to help them better explore the alternatives available to them.
Banks should deploy specialist staff when a branch closes to help all the above.
He also recommended banks based in Northern Ireland formally sign up to the protocol for the first time.
Prof Griggs said: “The banks have tried very hard to close branches properly and have not viewed the protocol as just a box ticking exercise. They have approached closures with the right culture, resource and emotion.
“However, the banks have not got it totally right and could significantly improve the way closures are communicated as well as their engagement with customers and stakeholders, including better explaining their decisions. Nothing like the protocol has ever been put in place before so the chances of it being absolutely correct were unlikely.”
The major high street banks have accepted the review’s recommendations and will now work with Prof Griggs to update the protocol.
Explaining his recommendations Prof Griggs recognised customers are driving the change in the way people now handle their personal finances and that banks are responding with an increase in online and app based banking
He added: “We are all changing the way we manage our finances and it us as customers who are driving that change and the pace at which we are going.
“We should not be surprised our traditional banks are realigning how they do things, which has led to the closure of branches as well as huge investment in the new online and mobile channels, as well as in branches which are being converted to be more in line with what we as consumers want from them.
“However, branches will not disappear as banks do still see them as a critical part of how they do business and have invested over £1bn in recent years to change and upgrade them.”
He also though states that given we know all the above is happening we should not be waiting until a bank branch closes to focus help on those that may need it to understand how these new forms of banking work and can be used but be doing that all the time more proactively than perhaps it is done now.
