North Wales MS Mark Isherwood has called on the Welsh Government to ensure that in establishing and rolling out a Community Bank in Wales, ‘Banc Cambria’, “tax-payers money is used prudently, that due diligence takes place, and that the bank is accessible to all”.
He also called for assurances that a Community Bank will not compete with the financial services being provided by Credit Unions and Post Offices, and that the necessary skills base for the bank is available.
Responding to yesterday’s Statement by the Economy Minister, ‘Supporting the creation of a Community Bank for Wales’, Mr Isherwood, who previously worked in the Mutual Building Society Sector for more than two decades and welcomed the fact that the Community Bank's partnership with Monmouthshire Building Society has been made public, said:
“In 2017 I led a debate on Banking Services here which called on the Welsh Government to examine the not-for-profit community banking model then being developed in Wales by ‘Responsible Finance’, which proposed working with Credit Unions, where Credit Unions can’t, and providing finance and support for people, businesses and social enterprises that cannot access finance from High Street Banks.
“In response to the Fifth Assembly’s Economy, Infrastructure and Skills Committee, the Federation of Small Businesses questioned whether the community bank solution overlaps with ‘other things that other instruments and institutions that we already have in place in Wales could be, actually, in a better place to do’. And so, given that this is a commercial investment for the Welsh Government, it is crucial that the Welsh Government performs due diligence and rigorous analysis of the business plan for a Community Bank prior to further investment.
“Of course, when performing due diligence, it’s also vital that the Welsh Government considers the impact that a Community Bank would have on the Credit Union sector. The Economy, Infrastructure and Skills Committee’s report in 2019 made it clear that credit unions have some very serious concerns about the impact that a community bank could have on them. In light of these concerns, what action is the Welsh Government is taking to ensure that the sustainability of Credit Unions is not threatened by the development of a Community Bank and how will the Welsh Government work with Credit Unions, which are keen to work with them, but concerned to ensure that Banc Cambria takes neither their business nor their funding?
“Given the Post Office Partnership with UK Banks, Banc Cambria could also have an impact on post office services. What assessment has the Minister therefore made of the impact of Banc Cambria on the post office sector and what discussions has he had with the Post Office about establishing a community bank in Wales?”
Mr Isherwood, said the creation of a community bank could have “a transformative impact on local communities, particularly rural communities, which have lost the presence of a bank on their high street”.
He added:
“It is reassuring that Banc Cambria has previously said that rural communities are at the heart of what they are trying to do. Banc Cambria has made it clear that it aims to open at least one branch where the customer base is evidenced as suffering particularly badly from financial exclusion. The First Minister has already spoken of locating a branch in Buckley, Flintshire. How, therefore, will the locations of the branches be decided – and what assurances can you provide that financially excluded rural communities will be at the top of the priority list?”
He also asked the Minister for assurances that the Welsh Government has the capacity to take this model forward into all parts of Wales, should it prove to be successful, and questioned him over access to the branches for disabled people.
Speaking afterwards, Mr Isherwood added
“We must support those communities suffering most from financial exclusion but, to achieve this, we must also ensure that tax payers money is being used prudently, that due diligence takes place, that the necessary skills base is available and that Banc Cambria is accessible to all.”