Banks should support essential shops that provide cash and lodgement services: RGDATA

“Taxes on windfall profits should also be considered for the insurance companies that are not lowering premiums,” said RGDATA director general Tara Buckley

"The extent to which banks have withdrawn from local communities is both significant and palpable," says RGDATA director general Tara Buckley

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Banks that are backing out of customer facing services should have to compensate retailers who are providing cash and lodgement services in store in towns and villages that banks are deserting, independent retailer representative group RGDATA has stated.

RGDATA has written to Taoiseach Michael Martin on this issue and stated that “the recent climbdown by AIB on the proposal to introduce over 70 cashless branches was very welcome and the strong response from government on the issue is acknowledged”.

The controversy raised an issue which needs to be addressed as banks incrementally reduce their presence and withdraw from communities, RGDATA stated.

“The extent to which banks have withdrawn from local communities is both significant and palpable,” wrote RGDATA director general Tara Buckley.

“The consequences of this disengagement have been dramatic for consumers and local businesses,” she continued. “From the perspective of local retailers, one of the significant implications of the closure and downgrading of banks has been the increased reliance placed on local shops to manage and make provision for the cash needs of communities.

“This means that shops are required to provide ATMs and cashback services, often for very low value or zero transactions. In the round the provision of such a community service costs shops considerable sums of money, ironically because of the punitive bank charges and restrictive conditions that banks impose for handling cash from businesses. It is not untypical for a retailer to have to fund up to €10,000 in additional cash management charges and costs following the diminution of banking services. And this cost is not enhanced by any additional turnover being generated.”

RGDATA urged the goverment to explore a scheme to compensate local retailers who are often stepping into the shoes of the banks in meeting community cash needs.

The association has proposed that a fund should be created by the banks to make payments to local businesses who can demonstrate they are incurring increased cash management costs following the withdrawal or downgrading of a bank branch in a community.

RGDATA requested in its letter to the Taoiseach, if the Department would facilitate this initiative as “a government led initiative is likely to get greater traction” with the banks.

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