Accessibility Links

BBA: Banking undergoing seismic change


The British Banking Association (BBA) has suggested that even experts in the industry have been shocked by its rapid pace of change, as the way people manage their finances shifts fundamentally.

Chief executive Anthony Browne pointed out that millions of people are now utilising mobile phone banking and other technological advances to access their accounts, leading to a corresponding decline in the use of local branches.

RBS has recorded a 30 per cent drop in footfall since 2010, while Tesco Bank reports that 85 per cent of its transactions are carried out online.

Customers of Britain's five largest banks used their mobile phones for more than 18 million transactions per week in 2013, research from the BBA revealed.

Overall, more than 12.4 million consumers have downloaded a banking app in recent years, highlighting the importance of technology and accessibility for retail finance institutions.

"Several senior bankers I have spoken to say they are astonished by the strength of the take-up of this technology, which has already led to a noticeable dip in customers contacting call centres," said Mr Browne.

Contactless payment is also becoming increasingly popular - nearly 40 million credit and debit cards equipped with this function have been issued, allowing people to transfer cash to retailers more easily.

"These innovations give customers greater flexibility than ever before about how they manage their money. They also help puncture the myth that banks innovate only for themselves," added the BBA chief executive.

Taken together, these various changes help explain why local branches are becoming quieter. Of course, this trend does not only apply to financial organisations - for instance, the decline in independent bookstores is a similar shift that has been brought about by technological developments, posited Mr Browne.

According to him, this does not mark the end of the high street branch. Instead, it will become somewhere customers visit for big moments such as signing up for their first mortgage.

However, the day-to-day business of retail banking is increasingly being conducted online and through mobile devices.


Related Articles
Latest Jobs