RBS customers face uncertainty in Scotland over branch closures, as the bank’s chief executive Ross McEwan appears for questioning before the Scottish Affairs Committee.
On December 1 2017 the bank announced the closure of 62 branches in Scotland. This was revised in February this year with 10 branches subject to a temporary reprieve.
Ahead of the questioning committee chair Pete Wishart MP commented: "RBS is a company that is still owned by the taxpayer and we still have many questions about the decision-making process that will lead to so many communities in Scotland being left without vital banking services.”
Appearing before the Parliamentary Scottish Affairs Committee, Mr McEwan explains the decision: “When we look at our customer behaviour, the evidence is stark. Branch use has fallen dramatically. The vast majority of our customers want to bank when it suits them, at all hours. They aren’t using the branch as their first port of call.”
Speaking of access to “face-to-face” service points, Mr McEwan says that customers have access to more than 2,000 physical points “in communities across Scotland”. This includes points of access to the bank such as within Post Offices or mobile vans.
Mr McEwan adds: “Every community where we are closing a branch will be served by at least one of our face-to-face services. In Scotland, we have 1.7 million [personal banking] customers. We do value them all.”
“We will make a final decision on the 10 branches under review by the end of this year.”
Mr McEwan says that after this round of reviews the RBS branch network will not be reviewed again until 2020.
The role of branches should be ‘reinvented’
Other voices in the industry disagree with RBS’ assessment of the importance of branch closures and the changing habits of customers. According to Nottingham Building Society, two in three (63%) of customers believe that branches have a “key role” in providing professional face-to-face advice for more complex financial transactions. One in three (31%) believe that branch closures would leave them financially excluded.
David Marlow, chief executive of The Nottingham, says: “We believe strongly that branches can have a positive future in the UK if their role is reinvented to become more relevant to what customers want. Our branch philosophy is to offer a wide range of services and help address the growing problem people face in accessing financial advice. By taking this approach, we have seen footfall in our branches increase by over 10% in recent years.
“Banks and building societies need to do more to try to prevent more branches from closing, and the industry should start by looking at the services offered and making sure they are more relevant to the needs of people today.”
While The Nottingham is only the ninth largest building society, it has the fifth largest branch network in the UK at over 67.