With over 300 bank branch closures affected this week, it’s a bleak outlook for personal and business bank customers.
‘One in five only bank digitally’
The Lloyds Banking Group announced the closure of 32 Lloyds branches, 11 Bank of Scotland branches and 6 branches of Halifax, amounting to 49 closures.
Now, the Royal Bank of Scotland has announced it is also closing branches – but on a much bigger scale, with a total of 259 branches set to disappear. RBS said that 62 Royal Bank of Scotland and 197 NatWest branches will close.
“More and more of our customers are choosing to do their everyday banking online or on mobile,” said an RBS spokesperson.
“Since 2014 the number of customers using our branches across the UK has fallen by 40% and mobile transactions have increased by 73% over the same period.
“Over 5 million customers now use our mobile banking app and one in five only bank with us digitally.”
To meet the demand RBS are “investing in our more popular branches” by “replacing traditional bricks and mortar branches with alternative ways to bank.”
These ‘alternative ways to bank’ include community bankers, mobile bank on wheels, and post offices.
Set to suffer: Small businesses and Scottish customers
The FSB have voiced their concerns about the closures.
Andy Willox, FSB’s Scottish policy convenor, called the news “bitterly disappointing,” particularly for Scottish communities, and warned:
“Ultimately, these changes will make it more difficult to run a business in much of Scotland – including many deprived communities and tourism hotspots.
“While many small businesses use online banking, that doesn’t mean they don’t handle cash, and therefore need to visit a branch. Further, many of the branches under threat are in parts of the country with particularly poor mobile and broadband coverage – a fact to which RBS seems to be paying scant regard.
Mr Willox added: “It is time for the big banks to come clean regarding their long-term plans. If they’re going to wind down their branch network, they need to develop proper alternatives to service all of their customers’ needs. So far promises made regarding smart ATMs and mobile banking have not been delivered.”
Mike Cherry, National chairman of the Federation of Small Businesses (FSB), said: “Many local business communities will be disappointed to hear they are losing their bank branch today.
“In areas of the country still blighted by poor broadband, accessing online banking is a challenge.
“What’s critical is that small business owners that rely on bank branches are provided with suitable alternatives well before closures happen. “
Mr Cherry expressed concern over banks “shutting branches on a whim” at a time when “cash is still critical to trade in thousands of our towns and villages, especially in tourist hotspots and rural areas.”
He added: “More and more small firms are accepting card payments but that comes with costs they’re forced to absorb. Equally, many have customers that only deal in cash.”
How much of your banking do you do online? Do you still rely on a local bank branch for services such as cash deposits? Let us know if and how your small business will be affected by dropping a comment in the section below.