Guest blog: A blueprint for restoring access to cash and financial services on our high streets

Michael Conville, Newcastle Building Society, introduces a fresh approach to tackling the challenge of maintaining and restoring access to cash.

By Michael Conville, Acting Chief Customer Officer, Newcastle Building Society

First published in Society Matters magazine.

Unsurprisingly, the subject of bank branch closures is one that often engenders an emotional response from the communities they impact the most. Since  2015, more than 5,000 banking branches have closed across the UK, with a raft of further closures in UK towns announced on what feels like a daily basis.  In the wake of this abandonment of local communities, could the financial services sector take a fresh approach to tackling the challenge of maintaining and restoring access to cash, preventing more of our high streets from  being cut-adrift?

The beginning of 2023 saw the latest step in Newcastle Building Society’s commitment to growing its high street presence and making people think differently about branches. As a UK-first, the mutual is piloting a project to restore access to cash on high streets and town centres. Collaborating with shared bank branch innovator  OneBanx, it is providing access to a multi-bank kiosk in its Gosforth (Newcastle) and Knaresborough (North  Yorkshire) branches.

The kiosks allow small businesses and personal customers of any bank in the Open Banking network to  withdraw and deposit cash and coins from their accounts by use of a mobile app. In their first month of  operation, the kiosks have experienced growing interest amongst customers, with feedback from local  businesses positive, embracing the service after bank closures as an alternative to travelling some distance to  the next nearest bank or undertaking basic banking tasks via the Post Office. As with the adoption of any new  amenity, there is a transition period, which the Society’s branch colleagues are supporting customers and  service users through.

It’s hoped the pilot will help keep cash alive and high streets vibrant in local communities, while addressing  customers’ dissatisfaction with the growing absence of available cash, inhibiting their ability to transact locally.  No less so than in Gosforth, Newcastle, which has seen several major bank branches close over recent years,  with more closures planned for 2023, despite concerns voiced by local businesses and residents. According to  a 2022 Which? survey, more people are turning to cash to help them budget in the face of a cost of living crisis.  Of 4,000 people surveyed, more than half (54%) said they regularly use cash alongside other payment methods such as debit and credit cards. Of those, half (52%) said that cash helps them keep track of their spending -  equivalent to 15 million people. Meanwhile 20% of people who don’t regularly use cash said they would start  using it if the cost of living crisis gets worse.¹

For Newcastle Building Society, restoring access to cash is just one strand of its blueprint for a future branch  model, which combines communities, technology and partnerships to deliver essential, face-to-face, and local  financial services cost effectively. Alongside convenient access to cash, the inability to transact locally has been highlighted as another concern for people. Newcastle Building Society’s UK consumer branch survey 2023,  suggests that 1.4million people in the UK now have to travel more than an hour to reach their closest branch.  With the average round trip costing £9.00, in-person banking is no longer possible for more than a quarter of  those surveyed.

The steady attrition of physical branches is an ongoing cause for concern UK-wide. The average UK adult still  visits their branch in-person twice a month, but 38% worry their local bank or building society will close this year, presenting more customers with longer journey times and increased costs to undertake the financial  transactions they wish, or need to conduct face-to-face.

A blueprint to maintain access to financial services

In 2016, in the Teesside town of Yarm, a joint scheme between Stockton Borough Council and Newcastle  Building Society saw the UK’s first library-based building society branch open its doors. This joint vision to share a resource to mutual advantage in order to support local people’s saving and borrowing needs and offer local face-to-face financial advice services has seen the branch achieve significant success, far exceeding early  expectations.

Sharing resource to deliver multiple services under one roof

In Hawes, a small market town in the Yorkshire Dales, the community suffered the plight of seeing its last bank  branch close at a time when the economy of the town relied on having access to financial services.

Working collaboratively with the Upper Dales Community Partnership, Newcastle Building Society set out to  restore the vital services that were being lost. In 2019, a community branch was established inside the Hawes Community Office, which also runs the local post office, a well-used volunteer bus service and the town’s library.  By sharing space at the heart of the community the mutual is able to support Hawes maintain several  vital services that run from the premises, while keeping its own operating costs comparatively low. A similar story in Wooler in Northumberland saw Newcastle Building Society’s community branch open in the Cheviot  centre in 2020, the successful product of a collaboration with the Glendale Gateway Trust. Its branch counter  sits alongside the Tourist Information service, a gift shop and a library.

Providing a lifeline to communities

In 2021, in the thriving market town of Knaresborough, North Yorkshire, Harrogate Borough Council needed a  solution after it received notice that the town’s last bank was to be closed.

After reaching out to Newcastle  Building Society to discuss options for establishing a branch presence to  maintain local access to financial services a further community branch was launched, this time inside  Knaresborough’s popular library building. It offers the Society’s full range of services and has created four new  jobs for the town, while becoming a pilot branch for the OneBanx kiosk to serve the bustling local economy,  restoring access to cash for both personal and business users.

The months ahead will see Newcastle Building Society continue to listen to customers, monitor usage of the  kiosks and improve where necessary. The Society is keen to point out that, if successful, the model is  potentially applicable to every high street.

As the Society continues to look for opportunities where it can bridge the gap in communities left abandoned by  financial services providers, it aims to take a tailored approach to meeting the needs of customers in its  heartland. Its Community branch model works in partnership with local people and organisations, leveraging technology, enabling it to fulfil its commitment to delivering face-to-face financial services.

Customer Testimonial

Situated in the heart of Knaresborough, the Music Bank opened in 2020 as an independent retailer selling a  wide range of instruments and offering musical tuition.

Nathan Francey, The Music Bank’s Store Manager, was one of the first to try out the OneBanx terminal in the  library branch, and said: “It’s fantastic to have the Newcastle Building Society branch in the library, it’s really convenient and the staff are so friendly. Hearing that customers and businesses will have access to cash  withdrawal and deposit is such a great boost for the town. The kiosk was straightforward to use and access, it  will save us so much time and effort travelling to Harrogate to our nearest bank branch, so as a business we will definitely be using the machine going forward.”

For more information:

Read more about Newcastle’s Community Branches at www.newcastle.co.uk/powering- communities/communitybranches

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