Financial Exclusion

Not so long ago, banks (together with other service providers like coffee shops and estates agents) picked up the slack on the high street as clothing sales dwindled. However, one of the big trends of the past 5 years has been the closure of banks, as retail banking becomes a web and mobile operation. This works fine for most of us who have moved to internet banking and find it more efficient, but for some groups the closure of physical branches might prove a barrier to accessing financial services. Last week, the Treasury Committee launched an inquiry into whether vulnerable customers are losing out, and the potential to introduce a ‘duty of care’ on banks to provide access. In the UK we typically rely on the market to decide what customers want, and as services and products have become digitised, the government has been unwilling to step-in and stem the trend toward online. In the event of a different approach to bank branches, then what next, and how far should our public duty extend? Whilst it feels very unlikely that there would be any interference with most commercial activity, quasi-public services could feasibly end up under the same microscope, for instance post offices. Beyond that, village shops and local pubs are both under threat and both play a key role in many people’s lives, for which vulnerable people are typically less able to find a substitute.