A new Government-commissioned report from Accenture has assessed the viability of moving Ireland away from cash and cheque transactions towards electronic transactions.
The report claims that in Ireland the number of branches per million of population is amongst the lowest in Europe, and that to counter this the Government should provide strong leadership on encouraging businesses and individuals to embrace electronic payments.
According to the report, such a move could save government alone between €40m and €70m a year.
But banks could prove to be the bigger winners by moving to electronic payments, reducing by half the cost of payments thereby saving between €120m and €200m a year.
The report read: “There is a strong economic rationale for the national e-payment strategy. Importantly for the government, it offers an opportunity to address some of the strategic national social and economic objectives.
“The real issue is the leadership challenge for the government – there is a need for co-ordination across different projects and initiatives, and there is a need to bring together the number of internal and external stakeholders to a common strategic goal and a common goal.”
Disturbingly, however, the report acknowledges that some 40pc of the Irish population don’t have a bank account. “Ireland’s low branch penetration has to be viewed in the context of a substantial section of the adult population that is unbanked. This may suggest that the Irish population might have been historically underserved in terms of access to banking,” it stated.
This clashes with an ongoing move by Irish banks to reduce the number of outlets throughout the country, particularly in sparsely populated rural areas.
However, the report continued, “once a critical density of electronic payment infrastructure distribution is reached, it may make sense from a commercial and customer service point of view to reduce the network of manned physical outlets.”
By John Kennedy