Plan mooted to reopen Scotland’s closed bank branches

Scotland’s bank branch crisis could be eased by founding a national financial institution mutually owned by its customers, a new report reveals.

This bank would provide a full range of services but, rather than focusing on shareholder profit, would be centred on quality of service and in restoring branches to communities which have lost them.

The report comes days after it was revealed that one in three Scottish bank branches has closed in the past five years.

Think-tank Common Weal is calling for the Scottish Government and local authorities to set up and seed-fund the new bank – but for it to be governed by its customers.

The study draws on a model developed by the Community Savings Bank Association. The start-up costs would be in the region of £20-40 million.

The bank could be up and running within 18 months.

It would aim to provide comprehensive banking services without engaging in aggressive cross-selling of financial products.

It would also seek to restore proper branch banking services to affected communities and develop long-term relationships with small businesses.

The report’s author, banking specialist Dr Gemma Bone, said: “Our current system has been failing to serve our communities and businesses for a long time, but until recently we have not had an alternative.

“Now, with the CSBA model wee are seeing a new generation of mutual regional banks springing up across the UK – now it’s Scotland’s turn.”