Supplementary memorandum by the Royal
Bank of Scotland
BASIC BANK
ACCOUNTS
As indicated in a paper of comment we have sent
separately to the Select Committee in response to your general
call for evidence, the RBS Group now has more than 800,000 basic
bank account holders. All of these, by definition, have access
to their accounts through Post Office counters. We provide more
than one in three of such basic bank accounts. We are proud of
our record in this area and have no objection to publishing these
figures.
The issue of offering access through Post Office
counters to our other current accounts is an entirely different
matter. These customers are, of course, not financially excluded,
and we have seen no indication that they would prefer to access
their accounts through the Post Office rather than through our
own branches, ATMs and call centres. Indeed, you will recall the
Committee's report on ATMs commented: "Members of the public
might question why they may have to queue for a service that would
be far more efficiently delivered through a free cash machine."
Some banks have chosen to enter bilateral arrangements
over their current account holders with the Post Office for their
own commercial reasons. We have taken a commercial decision not
to do so, since we have a very extensive network of branches across
the UK and have a policy of opening rather than closing branches.
We see no evidence that such an arrangement would be valued sufficiently
by our customers to justify the additional business expense. Moreover,
as a matter of straightforward competition, the Post Office has
begun in co-operation with another bank to sell its own competing
financial products to customers across the counter. If any of
our customers wish to access their bank accounts through the Post
Office, we are happy to open one of our basic bank accounts—all
of which, I repeat, are accessible through the Post Office—for
them either alongside or instead of their existing accounts.
We have no objection to the Post Office joining
the LiNK ATM network on exactly the same terms as any other operator.
To do so, it would presumably have to install a network of ATMs
in its premises. This is not, however, what the Post Office has
proposed. Instead, it wishes to join the scheme in order to make
cash available over the counter, which is not the kind of transaction
LiNK provides. In common with all members of LiNK we have opposed
this proposal. We would not object to the Post Office suggesting
a voluntary parallel scheme alongside the LiNK ATM scheme to handle
this kind of counter withdrawal. It would then be for individual
banks to decide whether it was in their commercial interests to
join such a scheme. This arrangement would not, however, change
the availability of basic banking services to those who have previously
been unbanked.
I hope this response will be useful for the
work of the Select Committee. And I agree with you that the industry
as a whole has continued to work hard to deal with some of the
issues identified by the Committee where we believe this can helpfully
improve levels of transparency to the customer. That remains our
aim.
February 2006
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