More than a book: Kim Suleman enjoys the face-to-face contact and extra help she gets by going into her branch
Kim Suleman is happy to embrace digital technology, but there is one area of her life where she draws the line. ‘I love my bank passbook and won’t give it up,’ says the freelance TV presenter and former entrepreneur.
For decades, passbooks were an essential part of banking. Customers would keep these small booklets issued by their bank or building society as a record of exactly how much they had in their account.
When customers went into a bank branch to make a transaction, the bank teller would input the latest balance on their account for their records.
Over recent years most banks and building societies have phased out passbooks and pushed customers into using digital technology such as online banking instead.
But many still like the reassurance passbooks offer – a physical record of their balances and the human touch of going into a branch to have it updated.
Kim, 62, from Whitley Bay in North Tyneside, says: ‘In the past when I’ve popped into my local Newcastle Building Society branch with my passbook to check my account balance, a member of staff has advised me to switch to a better rate to help make my money work harder.
‘If I have a question about my account, speaking with someone face-to-face is considerably easier. This level of service just isn’t possible online.’
This is Money’s sister title The Mail on Sunday last week revealed that Virgin Money had become the latest bank to scrap passbook accounts.
The owner of the Clydesdale and Yorkshire Bank brands will tell around 100,000 passbook holders next month that their accounts will no longer be serviced in-branch and will become statement-based only.
It follows a similar move by Lloyds Banking Group, which is withdrawing more than three million passbooks – a story The Mail on Sunday also reported first. Customers will now have to use mobile apps or cash machines to manage their nest eggs.
Among the accounts being axed is Halifax’s Liquid Gold, which was advertised heavily in the 1980s by the TV character Arthur Daley from the hit series Minder.
Lloyds’ decision raised concerns that older customers who did not use or trust online banking and rely on going into a branch – as they had always done – would struggle to access their money.
It also revived fears that fewer customers would visit branches if they no longer have passbooks – giving banks the perfect excuse to shutter even more.
Banks and building societies have closed 5,818 branches since 2015, at a rate of around 54 each month, according to campaign group Which?
Whitley Bay in North Tyneside has been particularly hard hit. ‘Four or five branches have gone in the past year – including HSBC, NatWest and Barclays – and Lloyds is closing its branch in November,’ Kim says.
Santander also no longer accepts passbooks, while Barclays ditched them when it bought Woolwich.
Even Nationwide – Britain’s largest building society which has promised to keep its branches open until at least 2026 – no longer offers passbook savings accounts to new customers. It said only ‘a small proportion’ of members solely used them to transact in branch, echoing other lenders.
But new research from Newcastle Building Society suggests the cost-of-living crisis has given passbooks a new lease of life.
It found passbook usage continues to grow with nearly half a million transactions each year across its 31 branches.
More than half (59 per cent) of the society’s members hold an account with a passbook or passcard and last year it issued three times as many passbooks as in 2021 – a period which coincides with the biggest squeeze on household incomes since the 1970s.
‘Customers tell us again and again how much they want to keep the option to use a savings passbook,’ says Michael Conville, chief customer officer at Newcastle Building Society.
‘Being able to manage their money face-to-face in a branch offers extra reassurance, convenience and security.
‘We’ve seen where banks on our high streets have either closed or stopped offering savings passbooks, new customers will join the Society because they know we’re committed to offering both digital and in-person financial services,’ he adds.
Another way banks have tried to push customers online is by offering lousy savings rates on passbook accounts – even as interest rates have soared.
Virgin Money’s passbook account offered zero interest on the lowest cash balances. It is being withdrawn ‘as part of the passbook removal process,’ a spokeswoman confirmed.
‘Customers with one of these particular products will be offered the choice of Virgin Money’s full range of on-sale savings products instead, all of which pay significantly higher interest than this passbook account,’ she adds.
For Newcastle customer Kim, the amount of interest paid on her passbook account – while important – is not the only key factor.
‘It’s more than just the money,’ Kim adds. ‘Passbooks are a link for some people to have human contact, the chance to talk to people. It’s a personal thing.’
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