5,162 banks and building societies closed in last seven years

MORE than 5,000 bank and building society branches have closed over the past seven years, according to analysis from Which?

The consumer group counted 5,162 bank and building society branches which have closed since January 2015.

A further 206 branches are set to close by the end of 2023, according to the Which? findings, as of midDecember 2022.

Rocio Concha, Which? director of policy and advocacy, said: “The shift to paying digitally has made life more convenient for millions, yet there remains a significant minority for whom cash is still vital as they are not ready or willing to make that switch.

“Those who rely on cash need protection from bank branch and ATM closures, with a minimum level of free access to cash guaranteed to ensure they don’t have to pay to withdraw their own money. But protecting access to cash is only useful if it is still widely accepted as a payment method.

“While businesses are best placed to decide whether or not to accept cash, we mustn’t sleepwalk into a situation where cash users struggle to make purchases or are excluded from certain services.

“The Financial Conduct Authority should therefore play a proactive role in monitoring levels of cash acceptance, regularly publishing data and taking action where appropriate.”

The UK Government has said it will legislate to protect the future of cash.

While some shops are still “cash only”, people may find they cannot use cash at all in some other places.

ATM network Link recently found that nearly half (45%) of people have been somewhere where cash has not been accepted, or has been discouraged.

Graham Mott, director of strategy at Link, said: “Despite all the talk about the death of cash, I think it is worth reminding ourselves of how important cash is.

“Compared to 2021, the number of transactions this year is up around 5%. Year on year we’re also seeing people take out more cash when they visit cash machines. To date, around £80 billion has been withdrawn from Link machines this year, and next year we are only expecting a small reduction of 3% to 5% on 2020’s figures.”

The Post Office has an agreement with many banks which allows people to do their everyday banking over its counters.

Ross Borkett, head of banking at the Post Office, said: “Post Office data shows many more families on low incomes are turning to cash to budget in light of cost-of-living increases and the financial pressures in the run-up to Christmas.

“It also remains critical that businesses can deposit their takings easily in their local branch.”