The pace at which retail banks are closing their branches is speeding up, with 650 branch closures expected this year – up from 500 branches in 2014 following 222 in 2013, according to the Campaign for Community Banking Services.
Banks retreating from the high street
These figures indicate banks are rapidly retreating from the high streets and instead shift their focus to digital and mobile channels.
Last year the banks closed 500 branches, more than double the amount closed the previous year, and such a rapid rate of closures is becoming a growing concern amongst local communities.
By the end of this year, there will only be 8400 bank branches in the UK, says the CCBS. This amount equates to 145 branches per million inhabitants, the lowest out of France, Italy, Germany and Spain. In terms of ratios, France is the closest to the UK, but even then our closest European neighbour has 410 branches per one million inhabitants, whilst Spain comes out on top with a staggering 690 branches per million inhabitants.
The campaign says the voluntary pledges by three of the ‘Big 4’ to keep open the ‘last bank in town’ protected 70 per cent of sole bank communities more than one mile from an alternative bank but were cancelled in 2014.during which 124 ‘last banks’ were closed with 177 more in course this year.
Closures impact smaller communities
Currently most impacted by closures are ‘market’ towns, rural hubs and seaside/retirement communities in England & Wales and secondary urban areas: all of which lose retail turnover as well as banking convenience.
When bank branches close, it affects retail because customers will go to other areas where they can shop and bank at the same time.
“ Communities are having to get used to a new environment where, following the government approved Access to Banking Protocol, which has applied to all branch closures announced after May 1, all that can be expected from engagement with the closing bank is some limited post closure provision for banking needs and early signs are that this is inadequate for many,” said Derek French. Director CCBS.
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