Hospitality and tourism hindered by lack of facilities
OPERATORS and trade groups have called on the UK government to legislate in order to prevent banks from closing branches in rural areas.
Research from consumer group Which? found that one third of Scottish banks and building societies had closed between 2010 and 2018, plummeting from 1625 to 1015.
Clare Winskill, owner of Coruisk House hotel in Elgol, Skye, said the lack of both branches and ATMs on Skye is reducing tourist spend and, when combined with low broadband speeds, making it “impossible to run a viable business” in parts of the island.
She said: “During peak season the two cash points in Broadford are frequently unable to keep up with the demand from visitors for cash.
“This impacts on cash-only payment businesses and leads to visitors spending less. In addition, many rural areas on Skye have very low broadband speeds, which are often insufficient speed to even open a bank account online making it impossible to carry out online banking.
“I think there should at least be an obligation for banks to have small cost-effective premises in rural areas that business owners can attend to make payments and to access some other banking facilities necessary to running a small business. This obligation must exist particularly in areas where broadband speeds are not sufficient to carry out online banking.”
Sylvia Mackay, manager of the Old School Restaurant and Rooms in Lairg, Sutherland, currently banks with a mobile branch due to the closest branch being located 75 miles away. She also backed calls for a tougher stance on branch closures.
She said: “We don’t expect banking facilities available every day from 8am to 6pm but banks have cut back so much it’s making things really difficult for businesses.
“They should definitely have an obligation to provide more services in rural areas, where you don’t have any options.”
Stuart Mackinnon, the Federation of Small Businesses in Scotland’s external affairs manager, said action must be taken to reverse the trend.
He said: “For many businesses, as long as a significant share of their customers want to continue to use cash, there needs to be appropriate local financial infrastructure. Policymakers need to take action to stop financial institutions removing this infrastructure from our communities.”
The Scottish Affairs Committee at Westminster last week launched the Access to Financial Services inquiry, which will look at the impact of bank and ATM closures across the country, with chair of the committee Pete Wishart MP stating it is “abundantly clear that regulations have not been strong enough”.
“Banks are using provision of mobile branches as a ‘get out of jail free card’, but these services are clearly insufficient,” he said.
“Banks continue to turn a blind eye to these very worrying consequences of their insistence on closing banking facilities. They must halt these closures or risk the suffering of Scotland’s rural businesses and tourism industry being on their watch.”