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Close to 250,000 Santander customers will be stripped of their much-loved passbooks, in the latest blow to traditional in-branch banking.
Customers will no longer be able to use the paper documents to keep a physical record of their transactions from March next year, despite the bank admitting passbooks were the “preferred way of banking” for many.
Instead customers will be given new “flexible cash cards”, which they will be able to use to draw cash from branches and Post Office branches, as well as up to £300 per day from cash machines, the bank has said. Customers who do not wish to remember a Pin can turn off the cash withdrawal function and instead sign for their cash over the counter.
Former passbook customers will also be given Santander-branded wallets, which they can use to store their own printed out paper statements.
Customers who do not want the new cash cards or wallets must bank online or via mobile banking.
Around 112,000 of the affected customers have not used online banking for at least three months, suggesting they depended on traditional means of managing their day-to-day spending.
Gareth Shaw of consumer group Which? said vulnerable customers risked being excluded by the move.
“We’ve seen rapid changes to the banking landscape as firms try to encourage more customers to get online, but it's important that as the transition to digital happens, customers who prefer or rely on traditional banking methods and cash are not left behind," he said.
“Banks that decide to phase out traditional passbooks must make sure they give customers - especially those who may be vulnerable or cash dependent - the support they need to adjust to the change, or to switch away to another account provider."
Santander’s Matt Hall said: “While passbooks are the preferred way of banking for some customers, we know that many also find them frustratingly time-consuming. By using new and efficient technology we can improve the experience and not only keep the functionality that comes with a passbook but enhance it.”
Passbooks were once as common as debit cards are today, but have become less well-used with the prevalence of online banking and the decline of the high street branch. The books were traditionally updated in branch each time a transaction occurred, and this would provide a record customers could use to track their income and outgoings at home.
Only 160 out of around 430 savings accounts, excluding Isas and bond accounts, now offer passbooks to customers, according to comparison site Moneyfacts. They are mainly offered by building societies.
Santander's move is the latest blow to traditional in-branch banking and follows a string of recent branch closures from a number of banking groups. In addition, HSBC has imposed new annual charges, as well as cash and cheque handling fees, for club accounts used by charities and societies.
The passbook withdrawal is expected to hit elderly Isa and “Rate for Life” customers, as well as young children with junior savings accounts hardest. Close to one in 10 passbook accounts belong to children. The move also applies to “Treasurers” accounts, typically used by local community groups.
Santander said it would shortly contact customers who have used a passbook 10 times or more in the calendar year 2020 or 2019. All other customers will be contacted by January 2022.