Three million to live without a bank branch by end of year

MILLIONS of people will not have a bank in their constituency by the end of this year as thousands more branches close across the UK, research has found.

The continued closure of bank branches means that 3m people who live in 30 parliamentary constituencies will miss out on physical banking services by Dec 31, according to consumer group Which?. Banks and building societies have closed 5,800 branches over the last decade at a rate of around 54 a month and more than half the branches that were open in 2015.

Natwest Group, which comprises Natwest, Royal Bank of Scotland and Ulster Bank, has closed 1,333 branches – the most of any banking group. Lloyds Banking Group, which includes Halifax and Bank of Scotland, has shut 1,072 branches. It comes as Rachel Reeves, the shadow chancellor, pledged in November to ramp up the construction of so-called “banking hubs” to give more people access to in-person banking services.

The Financial Conduct Authority (FCA), the City watchdog, outlined rules last month that banks must consider before closing branches or cash machines. Lenders will also be forced to review areas that offer limited cash access. The hubs are run by the Post Office, and lenders take turns staffing them on arranged business days.

The FCA said that it was concerned about the time it was taking to build hubs. So far only 30 out of the planned 100 hubs have been built, with another seven due to be completed by the end of the year. Despite some banks claiming that most people are turning away from cash, actual cash usage accounted for 19pc of all transactions in 2022, up from 15pc in 2021, according to figures from the British Retail Consortium.

Sam Richardson, of Which?, said: “Alternatives like banking hubs could help plug the gaps, but they are being rolled out too slowly, so more must be done to ensure communities get these replacements for their closed bank branches as soon as possible.

“It’s vital that the FCA works closely with banks and holds them accountable over decisions to close branches so more people aren’t left at risk of being cut adrift.”