Simon Read: At last we will have credible challengers to the greedy banks


So Virgin Money is finally set to launch its challenge to the high street banks after snapping up Northern Rock for £747m on Thursday. The deal won't actually go through until 1 January 2012 and then there will be a six- to nine-month process of rebranding the 70 or so branches that Northern Rock has.

But that means that the name of the former building society and collapsed bank will disappear from our high streets. Is that a reason to weep? Of course not. The name is synonymous with the credit crunch and global banking collapse. As such it's become a devalued and disgraced brand.

So what about the upstart that will replace it? Interestingly the Virgin brand is actually almost as old as the Northern Rock name. The building society was only created in 1965, from a merger between the Northern Counties Permanent Building Society and the Rock Building Society. (Admittedly, both of them had proud histories, which stretched back a century or more.)

Richard Branson created his Virgin brand only five years later when he opened a small Virgin Records and Tapes shop in Notting Hill. So Virgin has almost as much tradition behind it as Northern Rock. But, crucially, it hasn't been tainted by the financial scandal.

It means Virgin Money has the opportunity to offer a credible alterative to the traditional banks. To do so it needs to offer competitive products and decent service. It needs to build on the values that Branson has stood for over the past four decades but add a layer of additional trust that the big five banks have lost.

With only 75 branches in total and many of them in the north, the new outfit won't be able to compete in terms of branch banking. But when I chatted to senior officials at Virgin Money this week, they seemed confident that their future network of branches – albeit much smaller than any of the big five – will be enough to launch a credible alternative.

I hope that Virgin Money is up for the challenge. As customers we need a fresh banking alternative on the high street. To date our best hope for that has been the likes of the Co-operative Bank or the little London-based Metro Bank.

The former is still waiting anxiously to hear the outcome of its bid for the 600 or so branches that Lloyds Banking Group is being forced to sell off. News of that may not emerge until the New Year, but if the Co-op is successful, it could end up with almost 1,000 branches. That's more than enough to be seen as a major rival to the other banks.

Metro, meanwhile, has some great ideas behind the hoopla and hype of its balloons and dog bowls. Not least is the fact that you can walk into any of its branches and have a new debit card printed and made for you there and then. For those of us used to having to wait a week or more for our bank to send out new plastic, being able to walk into a branch and walk out with a new card minutes later is a great bit of customer service.

But Metro has only nine branches. And they're all in London. It also, as yet, has no online presence and has, reportedly, only provided 100 mortgages to customers since being launched some 15 months ago. That all adds up to an interesting sideshow so far rather than a real alternative.

So our hopes – for now – lie with Virgin. Jayne-Anne Gadhia, Virgin Money's chief executive, set out a promising statement of intent this week, saying: "We are aiming to build a true banking alternative for the UK consumer, one centred around our ambition to make everyone better off."

If they succeed in shaking up the banking market we all will be better off. If the Co-operative is successful in its bid for the Lloyds' branches as well, then, by next summer, we could have two serious challengers to the big five banks. For the sake of future generations of banking customers, I hope that Virgin Money and the Co-op both prove a success.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at

i100 In this video, the late actor Leonard Nimoy explains how he decided to use the gesture for his character
Arts and Entertainment
Secrets of JK Rowling's Harry Potter workings have been revealed in a new bibliography
arts + ents
Down-to-earth: Winstone isn't one for considering his 'legacy'
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: HR Benefits Manager

    £40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...

    Recruitment Genius: Office Manager / Financial Services

    £30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...

    Jemma Gent: Year End Accountant

    £250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...

    Jemma Gent: Management Accountant

    £230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...

    Day In a Page

    HIV pill: Scientists hail discovery of 'game-changer' that cuts the risk of infection among gay men by 86%

    Scientists hail daily pill that protects against HIV infection

    Breakthrough in battle against global scourge – but will the NHS pay for it?
    How we must adjust our lifestyles to nature: Welcome to the 'Anthropocene', the human epoch

    Time to play God

    Welcome to the 'Anthropocene', the human epoch where we may need to redefine nature itself
    MacGyver returns, but with a difference: Handyman hero of classic 1980s TV series to be recast as a woman

    MacGyver returns, but with a difference

    Handyman hero of classic 1980s TV series to be recast as a woman
    Tunnel renaissance: Why cities are hiding roads down in the ground

    Tunnel renaissance

    Why cities are hiding roads underground
    'Backstreet Boys - Show 'Em What You're Made Of': An affectionate look at five middle-aged men

    Boys to men

    The Backstreet Boys might be middle-aged, married and have dodgy knees, but a heartfelt documentary reveals they’re not going gently into pop’s good night
    Crufts 2015: Should foreign dogs be allowed to compete?

    Crufts 2015

    Should foreign dogs be allowed to compete?
    10 best projectors

    How to make your home cinema more cinematic: 10 best projectors

    Want to recreate the big-screen experience in your sitting room? IndyBest sizes up gadgets to form your film-watching
    Manchester City 1 Barcelona 2 player ratings: Luis Suarez? Lionel Messi? Joe Hart? Who was the star man?

    Manchester City vs Barcelona player ratings

    Luis Suarez? Lionel Messi? Joe Hart? Who was the star man at the Etihad?
    Arsenal vs Monaco: Monaco - the making of Gunners' manager Arsene Wenger

    Monaco: the making of Wenger

    Jack Pitt-Brooke speaks to former players and learns the Frenchman’s man-management has always been one of his best skills
    Cricket World Cup 2015: Chris Gayle - the West Indies' enigma lives up to his reputation

    Chris Gayle: The West Indies' enigma

    Some said the game's eternal rebel was washed up. As ever, he proved he writes the scripts by producing a blistering World Cup innings
    In Ukraine a dark world of hybrid warfare and murky loyalties prevails

    In Ukraine a dark world of hybrid warfare

    This war in the shadows has been going on since the fall of Mr Yanukovych
    'Birdman' and 'Bullets Over Broadway': Homage or plagiarism?

    Homage or plagiarism?

    'Birdman' shares much DNA with Woody Allen's 'Bullets Over Broadway'
    Broadchurch ends as damp squib not even David Tennant can revive

    A damp squib not even David Tennant can revive

    Broadchurch, Series 2 finale, review
    A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower: inside the mansion of Germany's 'Bishop of Bling'

    Inside the mansion of Germany's 'Bishop of Bling'

    A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower