Concerns raised about Labour’s Banc Cambria manifesto pledge
The Welsh Government has been urged to provide an update on the launch of a promised Welsh community bank that has been hindered by setbacks including the withdrawal of support from a leading Welsh building society.
Banc Cambria, a community banking offer, was originally promised in Welsh Labour’s 2021 election manifesto, but has been suffered the withdrawal of support from Monmouthshire Building Society (MBS), who had been developing the scheme on behalf of the Welsh Government.
‘First of its kind’
In July 2022, Monmouthshire Building Society hailed the plans as “the first-of-its-kind community bank in the UK”.
In a press release, they said that “the Community Bank for Wales will provide bilingual, everyday banking services for individuals and businesses — accessible through telephone, digital and a network of physical outlets to be located across Wales.”
At the time, the chief of Swansea Building Society raised a number of concerns about the project, not least the lack of transparency with regards to Welsh Labour’s choice of Monmouthshire Building Society and no input from Wales’ other financial institutions.
Alun Williams, Swansea Building Society Chief Executive said: “If the Welsh Government funds Monmouthshire Building Society to deliver that project, should they also be funding Swansea Building Society and the Principality Building Society for us to open more branches and expand our coverage in Wales?
“But Swansea Building Society weren’t even asked by the Welsh Government to attend any of the due diligence meetings that took place. I don’t think they even knew we existed until after we raised it with them and said, ‘We understand you’re having meetings about forming a new bank and nobody’s been in touch’. They came down and had a chat then.”
He also questioned why a community bank for Wales wasn’t being delivered through the Development Bank of Wales.
“We’ve already got a Welsh Government bank that has been trading for a long time, which has a board and staff structure in place, with offices across the country, albeit they only do commercial lending. Yet that isn’t the solution to provide the Banc Cambria project. That makes no sense to me at all.”
The Economy Minister, Vaughan Gething, confirmed in a Written Statement in March that Monmouthshire Building Society had decided to withdraw from the project.
Mr Gething said: “Our vision remains unchanged – that is for community banking services to develop in Wales, adding value and choice in the financial ecosystem and supporting community wealth building.”
“Welsh Government, therefore, remains open to working constructively with the sector to explore options and opportunities and we will continue to engage actively with Cambria Cydfuddiannol Limited to this end.”
In a statement released in July 2023, MBS’ Chief Executive Will Carroll said that “the UK’s economic situation has changed significantly – interest rates are rising, house prices are falling and the cost-of-living crisis continues”.
He added: “As a purpose-driven mutual building society, we prioritise our members and the communities they live in.
“This means we won’t take any unnecessary risks that could potentially impact on the Society’s performance or the trust our members place in us.
“Given the current unpredictability and ongoing challenges facing the UK economy, we’ve decided to stop working on our plans to deliver a community bank.”
The Welsh Liberal Dems are now calling for an update from the Welsh Government on what will be done to safeguard the scheme and ensure that the Welsh public have access to a community bank.
Real concerns about scheme’s future
The calls come ahead of the opening of a community banking hub funded by Cash Access UK in Welshpool earlier this month.
Commenting on the delays and lack of clarity, Welsh Liberal Democrats leader Jane Dodds MS said: “A local bank branch closing its doors has become a far too common occurrence in towns and villages across Wales.
“The closing of these branches has cut off thousands of people from accessing an in-person banking service, something that can prove to be vital for those of us who are less tech-savvy.
“Community banks, like the one I visited earlier this month in Welshpool, offer an alternative to a future where people are cut off from their banks.
“The Welsh Government, to their credit, have recognised this and in 2021 promised in their election manifesto a community banking scheme for Wales.
“However, since making this commitment, very little progress has been made and there are very real concerns about the future of this scheme.
“It’s time for the Welsh Government to shine some light on the matter.”
Welsh Government response
In response, a Welsh Government spokesperson said: “We are working on the development of a Community Bank. We have often stated that a Community Bank cannot be seen as a singular solution to the challenges arising from the flight of retail banks from our high streets and that we need solutions which engage all key stakeholders so that banking in our communities is sustainable and supports the needs of all users.”
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