AIB reverses decision to remove cash services from 70 branches
The Taoiseach has welcomed today's decision by AIB, saying that the move was “the right one”. Picture: Clodagh Kilcoyne Reuters
AIB has announced it will no longer remove cash services from 70 of its branches.
At 11.51am, Fine Gael TDs confirmed there would be an emergency meeting of the parliamentary party to discuss the fallout of AIB's decision to remove cash services from 70 branches.
Two minutes later, AIB itself confirmed it would be rowing back on those plans.
The reversal of their earlier decision was made due to the backlash it received from customers and the public unease it caused, the bank said in a statement.
AIB will now retain its 170-strong branch network in its entirety.
The announcement earlier in the week was met with anger and criticism from the public, businesses, and politicians alike.
The Taoiseach has welcomed today's decision by AIB, saying that the move was “the right one”.
Speaking in Singapore, Micheál Martin said that he was pleased with the fact that the bank was to engage with communities.
Mr Martin denied that the Government had been asleep at the wheel on the issue.
“The bank makes its own decisions, but it would normally give itself an indication to the Department of Finance a move of this significance."
Mr Martin said that he "didn't want to read too much" into the bank not notifying the government of the decision.
He said that the level of notification "is what it is" and said that he does not believe the State, which owns 71% of the bank, having a veto would be a good idea.
He said that AIB should reflect on its regional and rural strategy.
Asked about how the Government could protect rural communities as the economy becomes more digital and cashless, the Taoiseach said that the Government accepts there is a need for services in rural towns and that "as broad a range of services" was needed.
Finance Minister Paschal Donohoe also welcomed the news saying it is important that all people, including the vulnerable, can access banking services.
"Banks have a key role in maintaining the flow of cash through the economy and ensuring appropriate access to retail banking services for all in society, including the vulnerable.
Mr Donohoe said the country has seen many changes to our banking sector in recent years, driven by factors including advances in technology and changing consumer demand.
"It is against that background that I launched the Retail Banking Review to assess how the sector can be best positioned to meet current and future customer needs. I look forward to receiving the recommendations of the Review later in the year," he added.
On Friday morning, prior to the u-turn on removing cash services, members of the Rural Independent group of TDs staged a sit-in at the AIB headquarters in Dublin.
The rural TDs – Danny Healy Rae, Mattie McGrath and Michael Collins – said their sit-in was in response to what they called the failure of AIB CEO, Colin Hunt, to meet with them, after repeated requests over the last two days.
Speaking from inside AIB's Head Office on Molesworth Street in Dublin, the leader of the Rural Independent Group, Mr McGrath said: “Since AIB announced the calculated decision to make 70 of its 170 bank branches cashless earlier this week, we have heard absolutely nothing concrete from the government, either for the bank's decision reversal or the acceptance of our call to recall the Dáil.”
The Government was “totally blindsided” by the AIB decision to close the branches in advance, junior finance minister Sean Fleming has said.
He said there was no opportunity to discuss the issue with the bank and that Finance Minister Paschal Donohoe only found out a matter of hours before the announcement was made on Tuesday.
Mr Fleming said the bank has now reflected on the decision and reconsidered the move.
He said the decision to move to cashless services is “dead in the water”.
“Some people are concerned that this only paused. It is not, they have reversed the decision,” he said.
Aontú leader, Meath West TD and Finance Committee member Peadar Tóibín said that while the news is welcome but a temporary reprieve.
“We welcome the decision by AIB to reverse their decision to close cash services at 70 banks. However, the crisis in banking will continue unless there is the provision of proper competition in the banking sector.
"It has not happened by accident FG created what they called a Pillar Banking System after the crash," he said.
Fine Gael's plan was for the vast majority of the market to be serviced by only two banks, AIB and Banking of Ireland.
"Their plan is coming to pass with disastrous consequences. The continuing concentration of the banking market into only two suppliers is the creation of a duopoly. This gives these banks enormous supplier power," he added.
Cork East Fianna Fáil TD James O’Connor said there was widespread concern and deep disappointment when AIB announced plans to stop providing cash at many local branches.
“I and many of my Fianna Fáil party colleagues immediately sought a change of strategy from AIB on this deeply unfair move.
"Withdrawing cash services from branches will leave many of our most vulnerable people in towns across Ireland without cash banking services, with some customers having to travel an hour to access cash and ultimately getting left behind in terms of being able to effectively deal with their personal finances on a day-to-day basis," he said.
“I am pleased to see that AIB has now decided to change strategy and I will work with all relevant stakeholders to ensure that the voices of those most vulnerable are heard and they get all the support they deserve and need.”
Speaking on the initial plan to remove cash services, the bank said it was in response to the dramatic increase in the use of digital banking services and a decline in branch visits.
According to the bank, there has been a 35% decline in cash withdrawals from ATMs and a 50% fall in cheque usage over the past five years.
There has also been a fall of almost 50% in branch over-the-counter teller transactions while mobile and online payments had increased by 85% over the same period.
"It was in the context of this evolving banking environment and the opportunity to enhance its long-standing relationship with An Post that AIB took the decision to remove cash services from 70 of its branches," it said in a statement on Friday.
CONNECT WITH US TODAY
Be the first to know the latest news and updates
