Liverpool City Council is working with Wirral and Preston councils to help drive forward a plan to create an ‘ethical, council-led’ regional community bank.
The Community Savings Bank Association, which is registered with the Financial Conduct Authority, is seeking to develop 19 regional community banking models across the UK.
These would cater to the financial needs of people with ordinary means, local community groups and small and medium sized companies, and could help redress regional inequalities.
Today, Liverpool CC’s cabinet will consider a report which recommends due diligence begins on the establishment of the new bank, which would serve Cumbria, Lancashire and Merseyside.
If the business case for the bank is proven, an expert will be recruited to lead it and recruit board members. Social investors and regional anchor institutions would then have to be found to invest £20m of the share capital required.
‘The banking system is failing the poorest people in our city and the public sector has a duty to step in and address this inequality which is hurting those who can afford it least,’ said the mayor of Liverpool Joe Anderson.
‘We know that some individuals and businesses are excluded from obtaining a basic level of service and that those that can have been impacted by branch closures and charges for using ATMs.
‘It is vital people already hit by welfare reforms have the freedom to pay for goods and services however they choose, and access to cash must be maintained for those that need it.
‘There is a real opportunity here to provide mortgages for people who would not normally be able to get on the housing ladder, and create a market which provides opportunities for everyone.’