Call for bank hubs in wake of avalanche of branch closures

In the West Midlands there are 364 branches left – which works out as six per 100,000 people.

But that ratio is actually among the best in the country, which only Scotland enjoying a higher level.

The worst region is Yorkshire and the Humber, which has just 4.4 branches left per 100,000 people.

The East Midlands was found to have the second worst branch-to-people ratio, with 4.6 branches per 100,000 people.

Scotland has the “best” access to branches, at 6.9 per 100,000 people, but Which? said the uneven spread of its population means people living in more rural areas face long journeys to use a bank.

The research found 6,161 branches have been shut across the UK since 2015, representing over three-fifths of the banking network.

Which? said the impact on local communities can be devastating, with some of the most vulnerable members of society, such as those living with disabilities or on lower incomes, reliant on branches and either unable or unwilling to make the switch to banking digitally.

The South East is the region that has lost the most branches, Which? said, with 856 closures, followed by London with 804 branches shut. However, these regions had more branches serving larger populations. Across the UK, there are 30 parliamentary constituencies – representing just over three million people in total – without a bank branch, while another 56 are left with only one branch remaining, researchers said. New rules overseen by the Financial Conduct Authority (FCA) regulator came into effect last week. They mean banks will need to give more consideration to a local community’s cash needs before deciding to close a branch.

The watchdog will require firms to check whether additional services would be needed should a branch shut its doors or an ATM be switched off – and keep facilities open until the additional cash services are available. New FCA rules also give local residents more say over what their community’s cash needs are. People can request an assessment of whether there are gaps in local cash access and where significant gaps are found, providers will have to deliver reasonable additional cash services.

Banks are also sharing facilities through banking hubs.

Which? said given the number of branches that have closed in recent years, it wants to see many more hubs opened. Major banks have recently committed to opening 350 hubs by 2029. Sam Richardson, deputy editor of Which? Money, said: “Bank branch closures can have severe impacts on local communities, including on those who still want to use cash. New rules to protect free access to cash have been hard won and should make banks think twice about shutting branches without adequate replacements.

“While Yorkshire and the Humber may hold the dubious record for the worst branch access, this is a nationwide problem. Banking hubs will play a key role in replacing shuttered branches, but their rollout remains far too slow for consumers to feel their benefits. The Government must hold banks’ feet to the fire to ensure the commitments they’ve made to set up 350 hubs by 2029 are met.” and should be prepared to review the target upwards if necessary.”

Adrian Roberts, deputy chief executive of ATM and cash access network Link, said: “While more people are becoming comfortable banking and paying for things digitally, there are still millions of people who rely on cash or just prefer to use it.

“Our data shows that they aren’t just the oldest or the poorest in society, but also people who lack confidence or the skills and devices to bank digitally.

“The good news is that the access to cash rules set by the FCA mean we will be seeing more banking hubs on high streets all across the country, which alongside free-to-use ATMs and post offices will ensure access to cash is protected for many years to come. To date, Link has recommended 163 banking hubs.”

Cash Access UK, an organisation set up to help protect access to cash and funded by major banks, recently reached a milestone of hitting a total of one million transactions carried out in banking hubs throughout the UK.