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The UK has lost two-thirds of its bank branch network in 30 years, warns Which?

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The UK has lost almost two thirds of its bank branches in the last 30 years, leaving a fifth of households now more than three kilometres from their nearest branch, new Which? figures reveal.

According to parliamentary records, there were 20,583 branches in 1988, but the consumer champion’s analysis of all the current account providers shows that there are just 7,586 today.

While wholesale bank closures have left one in five (19%) of the population more than three kilometres from their nearest branch as the crow flies, almost one in 10 people (8%) have to travel more than five kilometres and six per cent are more than six kilometres from a bank.

New Which? research also calls into question the viability of Post Office branches as a solution to plug the gap in banking services – with almost half of adults unaware that they are available as an alternative.

Sparsely-populated parts of Scotland have been hit hardest by closures, accounting for the top 70 communities farthest from a bank.

However, Which?’s data shows that the South West and East of England have been disproportionately affected, taking into account the number of people living in each region.

For many smaller towns and people in rural locations, the loss of a local bank has been compounded by cashpoints closing following changes to how the LINK network is funded – with previous Which? research revealing the poorest households and older generations are set to be worst hit as access to cash is cut.

The Post Office – with its sprawling network of 11,547 branches – is often proposed as a solution when bank branches close.

And a Which? survey found good satisfaction ratings from those who had used a Post Office – with over three quarters (77%) saying they would be likely to use the service again.

However, almost half of adults (45%) in Great Britain were unaware that they could use a Post Office for banking purposes and almost half (47%) said they were unlikely to use one in the future.

Consumers unlikely to use the Post Office for banking cited a number of reasons such as concerns over staff expertise in financial services (28%), long queues (42%) and a lack of privacy to engage in financial affairs (32%). Six in ten (59%) simply prefer to deal directly with their bank.

There are also a number of services valued by consumers that are not currently offered by the Post Office. These include opening or closing accounts, transferring money between accounts, making a complaint about the bank and requesting a replacement debit card.

Banks also usually demand that customers call into a local branch for anti-fraud checks, or make an appointment to discuss important legal documents, such as lasting power of attorney or grant of probate. None of these tasks can be completed at a Post Office.

Among respondents to Which?’s survey, almost a third have transferred money from their account (29%), sought advice or made enquiries about savings (12%) and current accounts (9%) in the last year. Meanwhile, almost nine in 10 (86%) adults visited a bank branch at least once in the past year.

Which? wants banks to ensure that they cater to the needs of all their consumers. With many communities potentially struggling through the double blow of bank and cashpoint closures, Which? believes action is needed to ensure people aren’t financially excluded and denied access to cash, which millions still rely on.

Ceri Stanaway, Which? Money Editor, said:
“The true scale of bank branch closures in recent decades is staggering – and has left millions of people struggling to access the vital financial services and cash that they need.

“For many there is simply no substitute for a dedicated branch and the wide range of services it offers and many customers now face having to travel long distances if they are to avoid financial exclusion.

“We want to see banks properly justifying the reasons for closure and taking into account their customers’ needs before shutting their doors – and their customers out.”

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