Banking is a service which we all need for everyday living as well as when running a business; no matter how rich or poor the customer may be or how large or small the business is. Banking is essential.
Santander Bank, which is ranked amongst the top seven banks in the UK, has been reducing the number of their branches and has closed down hundreds of their outlets, not only in the UK but in Spain and other jurisdictions worldwide too. Other commercial banks have undergone very similar strategic changes. This is only the beginning of a new era which started years ago and has now sped up future expansion strategies after the pandemic.
It is a true fact that most retail businesses have changed. They now do a lot – if not most – of their business online, which has forced them to reduce space, relocate and close down hundreds of branches. Does this mean that banks will disappear? Some will, but most strong banks will surely adapt. Not long ago an interesting article in the Financial Times was explaining how smaller financial companies were competing on a very serious level with larger banks. Namely Revolut, which is well established in Gibraltar and the UK and has grown to some incredible levels. They offer fantastic banking services for a very competitive fee in lieu of the higher fees charged by traditional commercial banks.
This is only the beginning of a new era.
The article mentioned that Revolut was a serious contender of NatWest Bank; a very old banking institution. Some years back, high street banks used to do good business with money exchange amongst other traditional services. With the establishment of the euro in most of Europe, this business disappeared to a large extend. Not the case in the UK, Switzerland or Denmark where they kept their own traditional currencies and they still do some business with currencies. However, new online service companies like Revolut or Monzo give their customers a very attractive rate of exchange which works instantly and much better than most traditional banks, hence the move towards the online banking service providers. There is absolutely nothing new about this. Changes of this kind are happening each day and customers just go with the trend and certainly with the cost effective options.
The speed at which the business world is changing is astronomical, and not all the banks adapt as fast as they should. In Gibraltar, 25 years ago there were many more banks on Main Street than there are today. Most banks were taken over or decided to close down because they knew what was coming with the new digital era. Does this mean you cannot bank in Gibraltar? Most certainly not. You can bank in Gibraltar or anywhere you wish in the world. Or almost so. The array of online banks is very substantial and like in any other services sector you should be careful which company to choose to handle your banking needs, be it personal or for your business. You may reside in Paris or Dublin and use a bank which has its headquarters in Oslo or in Budapest. If the bank is good and provides a safe and adequate service at the right cost it could very well suit your needs and settle the matter.
The way forward is to check the bank first. There is plenty of information on the Internet along with the advice of a commercial lawyer or a business consultant. A personal recommendation of a friend or acquaintance is always helpful and reliable. If you see negative comments, or unhappy customers just stay away. Go for other banks or for the more traditional and established options. The choice is wide so make sure you pick up the correct ones.
Does this mean that banks will disappear?
Another good way forward is to use more than one option. Some of my customers use a local bank along with Revolut and Monzo. Each has its pluses and minuses but they seem to cover the main areas of interest as far as modern banking is concerned.
The banking world is changing as the retail business and most other businesses. The strong ones will adapt and move forward. Competition is fierce out there and the service Industries know this so they will try and offer good and attractive terms to their customers. This will result in a lot of changes taking place as far as customers are concerned. At the end of the day people want value for money and a good service. If neither of these work out it is a wise decision to make a move towards a new option. But again there is nothing new about this. It is a centuries-old strategy.