Mail Online

Banks set for more branch closures after big HSBC cull

By Jeff Prestridge

MASS branch closures are to continue into next year as the major banks drive down costs and bully customers to go online. It will result in hundreds of towns being left without a bank as alternative banking arrangements such as shared branches – banking hubs – are not opened quickly enough.

This is the view of banking experts in the wake of HSBC’s decision to axe nearly a quarter of its branch network. Some 114 high street sites will close from next April with HSBC saying the move is in response to banking remotely ‘becoming the norm’. This is on top of 69 closures announced in March and now implemented.

HSBC’s branch culling means the big banks have confirmed 617 closures this year – with Santander giving notice of five the day before HSBC’s announcement, then Nationwide closing one the day later and Barclays axeing 11 on Friday.

The rate of closures is in line with a forecast in February by a leading banking expert involved in the provision of high street banking services.

Speaking exclusively to The Mail on Sunday at the time, they warned that between 700 and 800 branches would be culled this year, stating: ‘There are going to be a lot of disappointed small businesses and angry branchdependent customers once branch closures start getting announced.’

On Friday, in the aftermath of HSBC’s decision, the same expert told the MoS that further closures were a ‘given’.

They added: ‘I wouldn’t be surprised if by the end of the year, 617 has grown to 800-plus. A further 800 closures cannot be ruled out next year.’ The source added: ‘It’s an outrage, especially given the Government’s decision to remove the cap on bankers’ bonuses – and its refusal to act on calls for the banks to be hit with a windfall tax.’

Lloyds, which has announced 136 closures this year, is the most heavily branched bank with more than 1,000 outlets across key brands – Bank of Scotland, Halifax and Lloyds. On Friday, it said it would continue to make changes to its branch network in response to changing customer behaviour. NatWest said the same.

Derek French, a longstanding campaigner for banking hubs, believes it is unlikely that big banking brands such as Barclays, Lloyds and NatWest will retain more than 400 branches each, mostly in large towns and cities.

French says that as closures continue and more towns lose their last bank, it is essential that banking hubs are set up in these communities. Run by the Post Office, hubs offer basic banking services and access to staff of the big banks on specific days. But, says French, their current rollout is ‘moving at a snail’s pace compared to the rate of branch closures’.

Banking hubs are funded by the banks, but so far only three out of 29 proposed have got off the ground. On Friday, John Howells, boss of cash machine network Link – an organisation key to deciding where hubs should be located – told the MoS: ‘The rollout of hubs has started just in time. It’s vital communities aren’t left without access to banking services.’

Natalie Ceeney, in charge of the introduction of hubs, said: ‘Setting up these hubs takes time, especially when it involves banks joining forces to share new infrastructure. This year we’ve been laying the foundations to roll out hubs. Having these in place will help us scale and streamline delivery – and we look forward to opening many more hubs in 2023.’

Tulip Siddiq, Shadow Economic Secretary to the Treasury, said: ‘HSBC’s closures are concerning. Older people, the poorest and the most vulnerable rely on bank branches for in-person financial advice and support.’

She added: ‘It’s inevitable that payment and banking systems will continue to innovate, but the Conservatives’ failure to protect these services risks cutting off millions of people from essential services, such as making and receiving payments or help with a loan.

‘We must ensure face-to-face services are protected, whether delivered through hubs or other models of community provision.’

Labour has tabled amendments to legislation on the issue that is making its way through Parliament.

OneBanx has opened a number of basic banking kiosks, primarily in Co-op stores, that enable people to get cash and deposit money without being charged. It is currently raising funds via crowdfunding site Crowdcube so it can expand its network. jeff.prestridge@mailonsunday.co.uk

Wealth & Personal Finance

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2022-12-04T08:00:00.0000000Z

2022-12-04T08:00:00.0000000Z

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