Barclays has decided to close down 30 branches in October and November
With lesser number of people visiting banks, the high street banks are cutting down on their branches across the UK. As the Internet and mobile phones play increasingly vital role in banking, the number of people visiting the banks is on sharp decline. Due to historic low interest rates, profit is a major concern for the high street banks which is driving closures of the branches across the country.
And the latest on the block is Barclays Bank, which has sent alarm bells ringing with its closure announcement. With more than 1300 branches, the bank has the highest number of branches in the country at present. But this is going to change soon as the bank announced closing down dozens of its branches across the UK. Specifically, 30 of the bank’s branches will be shut down in October and November, a decision which has triggered protests from the local communities.
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The towns and villages affected by the bank’s decision include Essex, Merseyside, Devon, Somerset, Scotland, Wales and the Isle of Wight. Although, the bank had 1,305 branches at the end of 2016, it is far less than the 1,600 branches it operated in the year 2011. The closure of the Bexley branch of the bank will leave the south-east London suburb without a high street bank. The Campaign for Community Banking Service (CCBS) states that approximately 1,500 communities are already without any branch of the high street banks, predicting further decline in the number of branches.
“The number of physical Barclays branches will reduce overall but our branch network and the colleagues who work in them remain a vital part of our offering,” a Barclays spokesperson said. “With customers visiting our branches less and less each year, we must constantly assess how and why our branches are used and make decisions based on that insight.”
Some of the other banks which have announced closure include RBS which will shut down 158 branches, HSBC will close 117 and Lloyds will shut down 100 branches.
Lib Dem leader and former business secretary Vince Cable said:
“Closures matter when it is the last bank in town. Small business is affected when there is nowhere to handle cash and less mobile residents are isolated. I negotiated a, protocol with the leading banks to transfer activities to the post office. I sense that under this government not much is being done to manage closures properly.”
Goodbody banking analyst John Cronin said:
“While it is becoming less common for consumers to use bank branches for routine transactions there is still a significant reliance. However, as banks refine and sophisticate their digital propositions we believe that the usage of branches will decline sharply.”
“This will take time but we believe it will lead to further significant rationalisation of branch estates in the coming years. Ultimately, we believe that the optimal store footprint will be much less in the longer-term than it is today.”
He added: “The challenge for incumbent banks with large branch estates is that customer loyalty could suffer in the event that drastic further cuts to networks were to be affected.”
Local Plaid Cymru councillor Chris Franks said people are concerned about how they can pay in cash.
“The irony is not lost on people that the public purse has paid a fortune for these banks and they are now abandoning taxpayers,”
said Franks.
“Previous reviews have found the authorisation process for banks, the cost of IT and access to branches as barriers to entry or expansion in retail banking. We no longer find this to be the case,”
the CMA said.
There are concerns for the older people who prefer to visit a branch physically rather than use the digital media. Age UK, the charity which works with older people says,
“Small business will also take fright of having to go long distances to a bank”. It said, “We’re asking [older] people to lead more independent lives in the community and then cutting it away”.
The banks themselves argue that branches will remain.
Barclays said:
“The number of physical Barclays branches will reduce overall but our branch network and the colleagues who work in them remain a vital part of our offering”.
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