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Prepare for a cull of bank branches like no other

THE way we access high street banking is changing. And if one expert I spoke to last week is correct, the banking landscape is on the cusp of major transformation. Far greater than I envisaged.

According to my mole – whose identity I have promised to protect – we are hurtling towards a future where the country’s leading banks between them run no more than 1,000 branches. To put this into perspective, they currently have around 5,000.

Such a savage culling of branches (fourteen more were axed by Barclays last week) would be assuaged by the setting up of 2,000 hubs – community branches run by the Post Office that customers of all the big banks would be able to use. So far, four hubs have been opened and a further 43 promised – including five new ones announced last week.

The financial maths explain everything. Closing a branch saves a bank on average £1million over five years, but funding a hub over the same time frame costs £250,000. So, shutting 4,000 branches saves banks £4billion, compared to the £500million cost of funding 2,000 hubs.

The banks would be £3.5billion better off as a result. So, for them, it’s a financial no-brainer.

Crucially, legislation passing through Parliament should safeguard access to cash. Until this becomes law, it is likely the big banks will back off from making significant branch cuts for fear of attracting criticism.

But once Royal Assent is granted in the summer, we will see an autumn culling of branches like we’ve never seen before.

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Wealth & Personal Finance

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2023-03-26T07:00:00.0000000Z

2023-03-26T07:00:00.0000000Z

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