The UK big banks are about to shut down their 1,000th local branch since they launched a scheme to protect access to cash and face-to-face financial services last year.
Under a voluntary agreement, the banks began assessing the impact of every branch closure from February 2022 as part of a commitment from the major banking groups to “ensure that no community is left without the cash access and deposit services it needs”.
The LINK initiative was aimed to ensure vulnerable customers and small businesses were not left behind in the switch to cashless payments and virtual banking. Since then hundreds of High Street branches have been shut down, with banking hubs or free ATMs set up in areas left without any local bank.
Less than two years into the scheme, the 1,000th local bank will be closed next month, when Virgin Money shuts its Reading branch on November 15. A further 150 branches from other lenders are also scheduled to close down before the end of 2023.
The wave of bank branch closures have affected every part of the UK, with a total of 978 in England, plus another 81 in Scotland, 65 in Wales, 25 in Northern Ireland, and one in Isle of Wight. Around a third of these closures (323) are in areas which have no alternative banks remaining, meaning customers will have to go online or travel to other locations to access financial services.
All the major banks have agreed to take part in the LINK initiative, including Barclays, HSBC, Natwest, Lloyds and Halifax. You can see which banks are closing or have closed in your area using our interactive map:
A spokesperson for Virgin Money said: “The decision to close a store is never taken lightly. But as our customers continue to change the way they want to bank with us, by conducting fewer transactions in-store and adopting the convenience of digital banking, we must respond to that evolving demand. We are proactively providing enhanced, bespoke care to ensure any vulnerable customers affected are supported through the changes.”
Nick Quin, Head of Financial Inclusion, LINK said “As more people choose to bank online or pay using cash, the UK will need fewer cash machines and more bank branches will close. There are still over five million people who rely on cash and it’s LINK’s role to make sure that every high street continues to have free access to cash for as long as they need it.
“Alongside protecting access to cash, whenever any bank branch closes, LINK will assess that location to understand whether it requires additional services such as a new ATM or banking hub. To date, we’ve recommended almost 100 hubs which are beginning to open across the UK. I would encourage any community without a bank branch to check on www.link.co.uk whether we have already recommended additional services, and if not get in touch with us to find out more.”
Of the bank closures that have been announced or have already taken place, Barclays has overseen the most closures, with 301 branches lost to the high street. That is followed by Lloyds (204), HSBC (183), Nat West (177), and Halifax (118). Barclays says it maintains an in-person presence in over 200 locations “where there is no longer enough demand to support a branch” through the Barclays Local network, based in libraries, town halls, mobile vans, and “banking pods”.
Age UK believes the “avalanche of closures” and the “snail’s pace” of the roll-out of banking hubs could potentially disenfranchise up to four million elderly people. It follows research that shows four in 10 elderly people with a bank account in Britain (39%) struggle to manage their money online and could be at risk of financial exclusion.
Caroline Abrahams, charity director for Age UK, said: “The continuing avalanche of bank branch closures means that by the end of this year, there will be considerably fewer opportunities for face-to-face banking than there were even just a couple of years ago. Older people living in rural and semi-rural areas are likely to be the hardest hit but those in towns and cities are not immune.
"The reality is that for almost everyone, it is getting progressively harder to bank face to face, leaving millions of older people who are not online potentially high and dry. Being able to manage your money is key to living independently as you age, but the rush towards digital banking means millions of older people are being deprived of this, simply because they do not use computers.”
Age UK has now called for remaining branch closures to be put on hold until more banking hubs have opened in areas with no alternative services.