REGIONAL banking could be making a comeback after Wiltshire Council pledged its support to a community bank run across the South West.

A £50k grant has been given towards the £2million project to create a South West bank called Avon Mutual. Eighteen similar banks will be launched across the UK to help people and businesses that traditionally struggle to be approved by large High Street chains.

The bank will be community owned with members required to purchase at least one share in the bank for £15.

The Community Savings Bank Association (CSBA) was established in 2015 to oversee the raft of new community banks.

Avon Mutual will be targeted at people who don’t have a bank acocunt or on universal credit to make banking easier. Functions like a ‘jam jar’ pot have been created to help them save money.

People on Universal Credit are around £490- £750 worse off a year if they don’t have a bank account set up.

The bank would also help small and medium businesses (SMEs) secure loans and see regional bank managers offer help to start-ups.

Just three per cent of bank loans from High Street chains were given to SMEs last year.

Cabinet member for finance Councillor Philip Whitehead called it an “exciting” initiative that could see pop-up banks launched in leisure centre and libraries in the county.

He added: “This is targeted to those who struggle to get bank accounts. The charging structure will be clear and transparent so people know what and why there are any charges.

“During the financial trouble in 2006-2008 countries with regional and mutual banks faired much better than countries that didn’t use them.

“Traditionally it has never worked in England but the difference is this model is now being used across the whole of the UK with shared technology and we have the advantage of social media to reach the people that most need support.”

Concerns were raised that similar projects in the UK had “fallen flat” in the past and may not reach the people who need help the most.

Cabinet member for house Richard Clewer said: “Regional banking works very well in Germany but that is built on 160 years of tradition. In UK these banks have been launched several times and tend to fall on its face. However we are seeing High Street banks closing and if this will enable us to bring banks back into our High Street that will be worth it.”

Leader of the Council Jane Scott wanted to make sure regional managers and pop up branches would be created in Wiltshire.

She said: “It is important to find out what this will deliver to Wiltshire. Personally I am quite excited by the idea of pop-up banks, leisure centres or banks that really will help an area such as Pewsey that has probably lost all its banks.”

She also warned that people getting a bank for the first time would need extra help from Avon Mutual to understand how to run the account.

Wiltshire Council cabinet approved the £50k grant to fund accreditation to the Financial Conduct Authority.