As the BBC reports today a further round of job cuts and branch closures has been initiated at Lloyds Bank. Since the demerger from TSB 400 branches and 12,000 jobs have been lost.
Retail banking has increasingly moved online and has become ever more electronic, so our need for branch servicing is falling rapidly. Commercial banking even more so. Yet for retail businesses that still deal in significant volumes of cash in the form of notes and coins the loss of branches can create a significant difficulty with additional inconvenience and cost.
The system is making cash an expensive means of trading, and it may well disappear within just a few years. There is political pressure for that, as without it the ‘dark’ economy can’t function. If money was fully digitised the constraints on interest rates falling significantly into negative territory would be removed, yet increasingly economists talk of this as the only way the mountains of government held debt can be afforded.
The world of banking is changing fast, it started in 2008 and I suspect we are about half way through. Institutions will not be mass employers soon, as jobs are replaced by technology. Along with them will go the traditional book-keeper, accountant and financial advisers, with a few specialist niche professionals on the edges. We’ve moved from a world of jobs for life to a world of a life of jobs, Expect more news like this over the next few months and years.