- Virgin Money announces closure of nearly one-third of branches due to changing customer demand
- Up to 260 positions at risk of being lost, prompting union’s call for reevaluation
- Closure program expected to be completed by end of the year, leaving 91 locations
A union wants a reevaluation since the lender argues the affected branches no longer do enough business.
Virgin Money is the latest bank to close roughly one-third of its branches.
The lender, which cited “changing customer demand” as the reason for its decision, acknowledged that some employees would be at risk of being laid off as a result, though it hoped to redeploy some of those affected.
According to Unite, up to 260 positions could be lost.
The announcement follows thousands of branch closures conducted by high-street lenders as part of cost-cutting initiatives since the financial crisis.
Consistently, the industry has argued that online and mobile banking services have diminished the demand for branch services.
By year’s end, Virgin Money will have 91 locations after the closure programme.
The company stated, “Each store was evaluated on an individual basis, taking into account the impact on the neighborhood, the needs of vulnerable customers, and the proximity of alternative services such as free ATMs and post offices.”
Each store closure is less than a half-mile away from the nearest Post Office, where customers can conduct daily transactions such as cash deposits and withdrawals, check deposits and balance inquiries, and coin exchange.
The chief operating officer of Virgin Money, Sarah Wilkinson, added, “The decision to close a store is never made lightly.”
However, as our consumers continue to alter their banking preferences by conducting fewer transactions in-store and embracing the convenience of digital banking, we must adapt to their changing preferences.
“We are committed to serving our consumers and coworkers. Throughout the review process, the proportion of vulnerable customers using each store was a key factor in our decision-making, and we will provide proactive, individualized care to ensure that any vulnerable customers affected by the changes are supported.
We will pursue all options to retain as many of our employees as possible in alternative roles. Due to their transferable talents, retail staff have done well in customer operations roles.
Caren Evans, a Unite national officer, responded, “The staff at Virgin Money UK are understandably devastated… Unite has urged the bank to reconsider its disastrous plans to withdraw banking services from communities that rely heavily on the expertise and experience of banking employees.
This decision will negatively impact some of the most vulnerable, disabled, and digitally excluded consumers.
Since 2015, more than 6,000 bank branches have closed, according to Unite.
The change has exacerbated concerns about access to cash and prompted demands for the City’s watchdog to use its pending authority to prevent communities from being cut off financially.
Virgin Money made its announcement before the July 31 implementation of the new consumer duty regulations.
Financial Conduct Authority chief executive Nikhil Rathi told Members of Parliament this week. “We hope they significantly increase consumer protection standards in financial services.”
Firms must consider how they place the customer at the center of every aspect of their business. Including product manufacturing, distribution, pricing, and customer service support.
