|
The recent visit by Derek French (CCBS Director) and David Cavell (banking consultant) to the principal operator of shared branching in the United States has confirmed the opportunities it offers for UK banks. |
| |
|
To put into a UK context, accept credit unions as the retail banks they are in the US - focus on the scheme itself and its potential application to UK retail banking. The problems it solves, how it overcomes the concerns the UK banks perceived at the time of the ‘Banking Without Branches’ study in 2000, the efficiency of the technology and its popularity with customers and participants as evidenced by high transaction volumes. |
| |
|
The top twenty neutral outlets (standalones) each handle an average of nearly 60000 transactions per month which equates to c1200 visits per day. We visited one of the smallest (pictured) which processed 9662 transactions in December 2008, involving around 200 visits per day; another in the Atlanta area, in a blue collar, lower income location handled 33730 in the same month, from an estimated 700 visits per day. |
| |
|
 |
|
Standalone at 3360 Satellite Boulevard Duluth GA
|
| |
|
Monthly volumes of shared branching transactions at individually branded shared branching sites (outlets) span the spectrum from 1 to 40000 and bring in much valued extra income to sustain viability of the host institution’s branch. Research has shown that shared branch users are 4 times as profitable to the account holding institution as non users. |
| |
|
In the UK there is a need similar to that in the US to sustain branches in areas which individual brands (here it is banks and building societies primarily but not excluding credit unions) cannot afford to service. |
| |
|
|
In Britain a formula already exists for using a more convenient bank’s counter - similar to the US outlet - but these days it is restricted to business use (Inter Bank Agency Agreements) but the banks have consistently resisted moves by the Competition Commission, the OFT and independent reviewers of the Banking Code for them to improve the awareness, operation and take-up of the facility to meet proven demand. |
| |
|
Similarly, unconvincing excuses have been put forward over the years to stall demands to trial neutral shared branches - what the Americans call standalones - despite the availability of variable formats (one pictured) to solve the branch loss problems of rural and low-income urban communities (including the financially excluded) and to substantially reduce delivery costs for the middle tier of the branch networks of the major banks while preserving competitive choice for the consumer. |
| |
|
 |
Artist’s Impression of a UK Neutral Shared Branch
© The Banking Centre Limited
|
