BANK closures are having a “devastating” impact on local business, retailers have told MSPs.
Pete Cheema of the Scottish Grocer’s Federation warned Holyrood’s Environment Committee further closures could hamper the Scottish economy.
He called for politicians to take action to ensure the last bank in any town is not able to close.
He said: “The current situation is having an absolutely devastating effect on local businesses.
“They are having to travel, in most cases, about an hour back and forth.”
Cheema said as well as the extra time, this causes security and insurance issues.
“It’s taking the basic fundamental rights of a business to do banking away from them,” he added.
He told the committee: “It’s going to cause the Scottish economy big issues if we are not careful.”
“We’re looking for a solution but we have already got a solution. We shouldn’t be closing the last bank in town.
“The solution is there and I think you guys need to take the action.”
Cheema questioned the discrepancy between claims by the banks of dwindling cash use, saying that in retail “cash is king”, comprising 76 per cent of transactions.
The committee is holding an inquiry into the impact of bank closures across Scotland after Clydesdale, Santander and RBS announced plans to shut more than 100 branches in total.
RBS, which is majority-owned by the taxpayer, has given a temporary reprieve until the end of 2018 to 10 of the 62 branches it plans to close, with an independent review on their long-term future.
MSPs heard from the Federation of Small Businesses Scotland that bank branches are estimated to have fallen from around 1100 in 2013 to 800. FSB’s Barry McCulloch said one member in Durness faces a three-hour round trip to the nearest bank.
Two shop owners also gave evidence, and one said he now has to work 60 hours a week and has let two staff go after a bank closure and ATM removal cut his takings by a fifth overnight.
He said he sold a previous business after a nearby bank closure cut his retail takings in half.
The other shop owner told Holyrood’s Economy Committee he needs change to prevent his business “coming to a crashing standstill”. He said the only bank in his town of Prestonpans closed, and getting change from the nearest branch in Musselburgh takes an hour compared to five minutes previously.
Phil Prentice, of Scotland’s Town’s Partnership, said he is not against closures but wants to see protection for the last branch in town and moves to reuse the empty buildings.
“We can see why branches have to shut, you can’t argue against the fact that less than one per cent of banking customers regularly use a branch,” he said.
“I think the banks should be more proactive and put in position where they are not just walking away.”
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