Two Devon councils say they are to invest a total of £100,000 to support the creation of a new high-street, local bank ‘to support the local economy’.
South Hams District Council and West Devon Borough Council said the bank, known for now as South West Mutual, would be “owned by its members and would pursue only what is in the customers’ best interests”.
A briefing from the bank says that it would not be get involved in financial trading or speculation. The new venture, proposed to be first ever high street bank dedicated to Cornwall,
Devon, Somerset and Dorset, is still subject to regulatory approvals.
The bank would be the first customer-owned full-service bank with a focus on Small and Medium enterprise and would committed to providing branches for customers.
South West Mutual has a commitment to financial inclusion and will be open to all residents including the estimated 21,000 individuals in Devon districts currently without a bank account.
To help cater for the needs of customers who prefer or need branch banking, including an estimated 106,000 non-users of the internet across Devon districts and 46% of the population who are uncomfortable with using digital only banks, the bank would provide branches across the South West with 24/7 video-linked machines and some staffed times.
The bank would provide seven staffed branches across the South West with 17 others containing 24/7 video-linked machines.
South Hams leader Councillor John Tucker said the authorities were supporting the initiative – supported by money generated from a business
rates pilot, not council tax – because local branches of the big banks were “being lost at an astonishing rate”.
The councils admitted the proposal was “not without risk”, but, without the funding, “benefits to the local economy may never be realised”.
This announcement comes after branches have been closing across Dartmoor, leaving some towns like Chagford without a branch entirely.
Tony Greenham of South West Mutual said:
“We want people across the south west to have a financial institution dedicated to the region and which they can trust to put their interests first.
‘That’s why we are creating a bank that is owned by its members, behaves ethically, supports local economies and serves ordinary people and smaller businesses.
‘There is a lot of work to do before we can obtain a banking licence to open in 2020 but receiving support from local councils will get us off to a flying start.”