Nick Goodway: Customers will move on if their bank branches are axed

"Too fast, too far” was trade union Unite’s predictable reaction to Lloyds Bank’s announcement that it would cut an extra 3000 jobs and close another 200 branches as its customers embrace digital banking.

Chief executive Antonio Horta-Osorio’s statistic that footfall in branches is declining, at 15% against 8% a year ago, certainly seemed to justify the axe being taken faster and further into the branch network.

But new data supplied to me by Accenture suggest Unite is at least correct in warning banks against going too fast.

Looking at trends between 2010 and 2015, shows — not surprisingly — that the monthly use of mobile banking is up from 8% to 34%, reflecting the ubiquity of the smartphone. The use of telephone banking has risen slightly from 14% to 16% of customers.

When it comes to internet banking, there has actually been a decrease from 79% to 74%, with the difference probably being the shift to mobile.

But the number of customers who visit a branch of their bank at least once a month has, surprisingly, risen from 47% to 52%.

So, more than half the millions of bank customers in this country go into a branch on a regular basis. Indeed, 69% of them say they prefer to take important financial decisions such as retirement planning, investment advice or mortgage applications in person rather than online.

Accenture managing director Peter Kirk says that, while the arrival of more sophisticated self-service machines has helped to pull customers into branches, there is still a strong demand for face-to- face banking when it comes to big-ticket items.

“Transactional banking is and will continue to move onto digital platforms,” he adds. “But habits do seem quite slow to change.”

Transactional banking is, of course, only just profitable or even unprofitable on some accounts for the banks. None of them have yet really cracked charging for current accounts, although they have moved some way in that direction with packaged accounts.