Contribution
The hon. Member makes a very good point. For people wishing to access banking services in Wincanton only the post office remains, despite the town’s continued growth, with more homes being built. Yet research from the Post Office found that 82% of consumers find it important to be able to access at least one in-person banking service, and the many small local and independent businesses that make Wincanton such a lovely market town will undoubtedly be inconvenienced.
In a rural county such as Somerset a significant number of businesses are SMEs: 78% employ fewer than five people. As the Countryside Alliance outlined earlier this year in its submission to the Treasury’s call for evidence on access to banking services, cash plays
“an important role across much of the rural economy.”
Business owners in rural areas are forced to travel further to bank their takings, deposit cash and obtain change. That reduces their productivity, increases fuel costs and adds to their administrative burden when they already operate on tight margins. SMEs, on average, deposit cash twice per month, but rural businesses may now postpone cashing in until they have more to deposit in order to avoid additional travel. However, that makes them more vulnerable to a growing rural crime epidemic. The total cost of rural crime in 2025 was estimated by the National Farmers Union Mutual to be £41.5 million, and increasingly sophisticated and organised gangs are operating in rural areas.
If rural economies are to thrive it is vital that rural businesses are not put at a disadvantage simply due to their location. That is why Liberal Democrats in the other place tabled an amendment to the Financial Services and Markets Bill that would require the Treasury to assess alternative frameworks, including the post office banking framework, for providing access to banking and cash services.
In many rural areas the post office network has become a lifeline. It is often the only local place to make cash withdrawals, deposits, and everyday banking transactions. During the summer recess I was delighted to support the reopening of two post offices in my constituency. Henstridge post office recently opened after local residents Lesley and Andy Scard and their neighbours Barry and Helen Howlett worked tirelessly to reopen the much-missed and much-needed community shop and post office. In Somerton the long-awaited post office has also returned, based inside the Stationery House, after Malcolm Adams stepped up and refurbished part of his shop to accommodate it. However, many local post offices are still under threat and we have seen closures recently in Butleigh and Charlton Adam.
Following last year’s Green Paper, the Government must commit to rural-proofing the post office and look at ways in which the post office can drive wider access to banking as part of the Treasury’s ongoing access to banking services review. Without adequate investment post offices cannot replace bank branches. Will the Minister commit to properly rural-proof the post office network so that postmasters are adequately resourced to take on the increased demand for local banking, rather than forced to absorb the cost when they are providing such a vital service?
The Liberal Democrats support the introduction of a fair banking Act to tackle financial exclusion. We have committed to the introduction of a national financial inclusion strategy that would require both the Financial Conduct Authority and the Prudential Regulation Authority to have regard for financial inclusion, such as by protecting access to cash in remote areas and supporting banking hubs.
Of course, the impact of bank closures is compounded by a deeper problem of digital exclusion. Across the country 1.7 million households have no broadband or mobile internet at home, around 2.4 million people cannot complete a single basic online task such as opening an internet browser, and over 5 million employed adults cannot complete essential digital tasks at work. Basic digital skills are set to become the UK’s largest skills gap by 2030. With the cost of living still biting, up to 1 million people have cut back or cancelled their internet packages altogether in the past year, while banks push them to access services online. In rural Somerset, patchy mobile signal and frustratingly slow broadband are not just an inconvenience; they are the difference between banking and not banking at all. Older and disabled residents, and those with visual impairments, are too often advised to download an app as if that were an appropriate solution; instead, it simply causes a further barrier.
Rural communities are not asking for special treatment or to be treated differently. They ask for a fair formula so that they are not left behind. Face-to-face banking, a functioning post office network and reliable connectivity are not luxuries; they are part of the basic infrastructure of rural life. Will the Minister commit to rural-proof banking policy and to bring forward without further delay a national financial inclusion strategy that genuinely supports rural communities? Unreliable access to face-to-face banking stymies economic growth and drives people and businesses out of rural communities. Somerset cannot wait, and neither can rural Britain.