More than one in eight UK bank branches to close in 2023

Receive free UK bank updates

More than one in eight UK bank branches to open by early 2023 will close by December, and nearly three-fifths of the network have disappeared since 2015.

A total of 636 bank branches are set to close by the end of the year, out of 424 so far, according to a Financial Times analysis based on data from ATM provider LINK. Some 42 more projects have been announced for 2024.

The closures underscore the growing scarcity of cash infrastructure across the country, despite the government’s proposal last month to ensure long-term access to cash.

“Branch closures don’t just mean one less local place to withdraw or deposit cash,” said Sam Richardson, deputy editor of consumer rights magazine Which?. Money.

“[It]also makes it harder to access face-to-face banking services – which is especially important for more vulnerable customers.”

Which is the consumer group? It is estimated that this year’s closures will leave just over 4,000 branches across the UK, of which 5,600 have closed since January 2015, when data began to be tracked.

Banks have been cutting costly branch networks for decades, but the rate has risen in recent years as digital alternatives have become more popular, and the rate has risen sharply because of the pandemic.

Derek French, a former NatWest executive, said the nature of branch closures has changed since the closure of the community banking operation he founded in 2016.

“It used to be a rural problem in small towns and big villages,” he said, “but it’s increasingly a problem in big cities that hold up the surrounding hinterland that was lost years ago. branch.”

Cities including Southampton, Norwich, Dundee and Leeds are all set to lose multiple branches by the end of 2023, in addition to the more than 100 branches closed or closed in London this year.

Alternatives such as digital banking are not ideal for vulnerable groups, including those economically disadvantaged who rely on physical cash to manage expenses, French said.

“For those who are less affluent, if you’re waving your phone or card and you don’t get a receipt, they’re going to find it very difficult to budget,” he said. “Cash may be down, but I do think that when you look at the population as a whole, there are good reasons for cash to be an option.”

Bar graph of closures by region shows that more than 600 bank branches will close by the end of 2023

In August, the government set limits on how far people can travel to access cash services, and banks face fines and withdrawals if they fail to ensure 95 percent of their retail customers and businesses are within three miles of a deposit facility.

Efforts to create “banking centers,” partnerships between post offices and lenders in neighborhoods without branches, are a welcome option. However, the pace of their rollout has been criticized. Of the 76 hubs announced so far, only seven are currently open.

LINK chief executive John Howells said: “I think we’re going to see more branch closures, but on top of that we’re going to see hundreds of banking centers and the banks have to stay open, Until the new center is put into use.”

Fellow Conservative Chris Holmes, a longtime campaigner for equal access to cash, said ensuring the availability of physical currency would only solve part of the problem. He called for legislation to ensure cash is accepted amid the increasing adoption of digital or card-only payments in retail environments.

He noted that some U.S. states and cities require brick-and-mortar businesses to accept cash.

“What’s the point of getting cash if you don’t have somewhere to spend it?” he asked. “It’s very important that everyone understands this, otherwise certain communities risk being excluded.”

“The way people access and manage money has been changing for decades,” Treasury said. “While our choice and convenience to support digital payments continues to grow, cash still has an important and continuing role to play.”

Svlook