Almost two years after the State's financial institutions began to close branches, bankers have finally come together to adopt a code of practice on the procedures involved.
The code commits banks and building societies to meaningful consultation with those affected by the closure of local branches and to educating customers about the alternatives to branch banking.
Its objectives are laudable, particularly the educational aspects. And although the response so far from some business and community groups has been less than positive, they should seek to exploit the initiative to ensure they can access a banking service that meets their requirements.
Branch closures, of course, are not something that bankers discuss. In the rarefied world of financial services, the process is known as "branch restructuring". It is a means of reducing the costs of administration and ensuring that the maximum number of visitors to branches are there to buy money-spinning products such as mortgages or investments.
But branch closures are emotive and must be handled with sensitivity. Customers - regardless of the size of their bank balance - must be reassured that they are not being abandoned by their bank. And experience to date shows clearly that the institutions involved have some way to go in this regard.
As part of the new code of practice, financial institutions have committed to providing a minimum of two months' notice to customers before a branch, or sub-branch, is closed. These decisions will be communicated to the wider local community though the local media.
After notice of closure, the institution will maintain communication with staff, customers and public representatives to ensure there is a smooth transition to any new banking arrangements for those affected.
This commitment should be tested by anyone with concerns about the future of their existing banking services. Following a series of high-profile protests in response to closure announcements, the financial institutions have learned that customers have very high expectations of banks. They expect to have a branch close by where staff are familiar with their needs. They also expect the banks to listen to their concerns where a closure is on the cards.
In Britain, where branch closures are as much a fact of life as they have become here, small businesses fought a campaign to ensure they would not suffer when banking services were withdrawn. Some 26 organisations, including the Federation of Small Businesses, initiated the Campaign for Community Banking Services. So far, it has been modestly successful.
It argued that businesses affected by closures would be forced to spend time they can ill afford travelling miles to their nearest branch to conduct transactions. Some would have to shut up shop while they made the trip, while others were concerned about increased security risks if they were forced to keep cash more frequently in their businesses overnight.
The campaign also highlighted a knock-on effect of branch closures upon business, as customers tended to shop elsewhere if they were forced to travel further to a bank.
It presented the British Bankers' Association with a proposal that the major high street banks could share premises to provide local services to all of their customers under one roof.
From next January, a pilot scheme for shared bank services will be introduced for a period of 12 months. These shared services will be offered in 10 locations across Britain and Wales in communities where there is only a single bank branch and no others within a five-mile radius.
Selected branches of Barclays, HSBC, LloydsTSB and NatWest will participate in providing banking services for personal and small business customers, dividing the costs between them. The success of the initiative in meeting community needs will be reviewed at the end of the pilot.
Given the time it has taken for the Irish financial services industry to agree a code of practice, it would be interesting to see how it would respond to a shared services proposal.
In the meantime, the convenience of telephone and internet banking options has been recognised by hundreds of thousands of bank customers who have organised their banking services in such a way that they probably never have to visit their branch. This is music to the ears of the bankers. But there are others, particularly the elderly, who will not be that easily swayed.
The code of practice requires the establishment of a programme to promote greater familiarisation with automated cash machines, Laser cards, credit cards, direct debits and telephone and internet banking.
In the autumn, an information programme, funded by the banking sector, will meet community groups and interested parties to explain the options facing customers.
The Irish Bankers' Federation is devising the programme, which it envisages will inform groups such as the elderly or those living in isolated areas about how to use alternative services and identify those that might suit them best. The federation has said it will not favour one bank over another in terms of the product mix.
It is envisaged that retired bank officials and hopefully some new users of these services will be recruited to deliver the message.
This, combined with the new code of practice, is a step forward on the part of institutions, which have been very slow to wake up to customer concerns on branch closures. But with closures set to continue, the reality remains that it will numb rather than alleviate the pain for the customers involved.
screaton@irish-times.ie
