NI sees 20% of major bank branches shut down
on 11/09/2013 16:22:46
Digital online access to accounts is becoming more widespread but elderly and rural people could be disproportionately affected by the shift from face-to-face contact after the shutting of 53 branches, the North's Consumer Council warned.
A wide-ranging inquiry into how banks operate in the North has begun at Westminster.
Council policy director Aodhan O'Donnell told MPs: "We know there are certain areas where two or three banks have closed with a massive impact on access.
"We are of the view that you don't have to live in a rural area to be isolated, there are towns and villages where people are losing access to their branches and that is going to have a massive impact, it is going to hinder financial inclusion."
The Council said the number of branches of the largest four banks (First Trust, Danske, Ulster Bank and Bank of Ireland) reduced from 252 to 199 (21%) in the last two years.
According to recent research by the representative group, 80% of those surveyed visited a branch at least once in the past year. Six in ten people had done so in the past month, and three in ten during the past week.
For two thirds of people, the main reason for using a branch was to do something they perceived could not be done online or on the phone. The second reason was a lack of comfort with using online or phone services. Older people, in particular, are much more likely to use a branch because they are not as comfortable with using online or phone banking as younger people, the Council said.
In January, Ulster Bank said it will close in the region of 20 branches and sub-offices on the island of Ireland this year. The third-largest bank in Ireland is owned by Royal Bank of Scotland (RBS).
Politicians on the Northern Ireland Affairs Committee are investigating wider lending practices and the future of the Ulster.
The British government is considering whether to split the bank from the RBS group, due to its toxic property debts. This year Ulster Bank posted losses of £1bn (€1.18bn).
The bank was heavily criticised when many customers lost access to their accounts following a technical glitch last year but Mr O'Donnell said large numbers did not switch to a competitor.
The policy expert said there had been delays in restoring access for Ulster Bank consumers in Northern Ireland. "The key concern for consumers there was we were bottom of the line in terms of getting resolution.
"The network in Great Britain, RBS, was up and running before attention turned to (Northern Ireland) bank consumers and that was the key impact."
Around 13% of people in Northern Ireland have no bank account at all, the Council said, leaving them unable to establish direct debits, and potentially paying more for services.