Standards slipping – Bank branch closure guidelines failing communities

Which? is warning that bank branch closure rules are not fit for purpose and have done little to mitigate against the impact of the devastating cuts to the UK’s branch network, which has reduced by a third in the past five years.

Despite the introduction in 2017 of a code requiring banks to assess the impact on communities of branch cuts, a Which? investigation found that HSBC, Lloyds Banking Group, Santander, the Co-operative Bank, TSB, and Virgin Money have never reversed a closure decision.

Collectively, these banks have closed more than 600 branches since it came into effect, with many going ahead in the face of widespread dismay among the customers who rely on them.

The code, known as the Access to Banking Standard, has no specific procedure to halt a closure. However, it does require banks to complete an impact assessment of the decision and must provide detail of issues raised by consumers. Which? believes its credibility is highly questionable if these consultations have never led to a bank realising that access concerns could not be adequately addressed without keeping the branch open.

RBS Group, now known as NatWest Group, and Barclays did not provide an answer to how many decisions they had reversed, but the two banks have closed 651 and 386 branches respectively since the Standard was introduced.

A Which? investigation into the Standard has uncovered how issues most pressing to those affected by branch closures are not addressed within it, meaning that the help it can provide affected communities is negligible, and effectively a box ticking exercise.

For instance, it does not explicitly require banks to take into account the domino effect of one branch closure quickly following another, the impact on high street businesses and the local economy, or other developments that could affect the banking needs of a community.

The findings come as new Which? research reveals branch cuts already announced for 2020 could see 247 bank branches shut this year, leaving the UK with 35 per cent fewer than in 2015.

The closures are a further blow for communities that are already struggling to access essential banking services. Following years of decline, the impact of coronavirus has worsened the situation further, leading many branches to operate with reduced opening hours, while thousands of cash machines were also taken out of operation with many yet to reopen.

A new survey of Which? members who experienced a bank branch closure between 2018-2020 also highlights the woefully inadequate attempts made by banks to inform customers about branch closures.

Despite engagement with local communities being a requirement of the code, one in seven (15%) of Which? members who saw one or more branches closed in their area said they first learned of their branch closing after it shut its doors.

It also found many closures are taking place despite those branches being regularly used by customers. More than half (53%) of respondents said that they were using their nearby branch at least once a month before it closed.

The figure was even higher for disabled consumers who saw at least one bank branch close between 2018-2020. More than six in ten (64%) respondents on the panel of the Research Institute for Disabled Consumers answered that they were using the branch at least once a month before it closed.

But just one in 10 (9%) respondents to the Which? survey said they had read one of the ‘impact assessments’ banks are required to publish, in which they must detail the reasons for the closure and outline alternative options for the community once the branch shuts. This is commonly the local Post Office, which provides access to everyday banking, although customers cannot carry out the full range of banking that a dedicated branch offers.

However, banks are also doing a very poor job of informing local postmasters that a branch is closing. New Citizens Advice research reveals that nearly eight in ten (77%) were not notified, despite engagement being crucial to help them prepare for an increased number of customers and be ready to provide the additional support.

Last week, the Financial Conduct Authority (FCA) announced that it was consulting on its own guidance to banks who are planning to close a branch or cash machine – a recognition that the existing process is simply not up to scratch. Which? welcomes this development, and expects the regulator to take strong action against banks if they are found to be failing to treat customers fairly when taking these decisions.

The consumer champion is now calling on the FCA to act on the weaknesses in the branch closures process it has identified, ensure that banks follow its guidelines properly and be prepared to take action if decisions taken by banks lead to communities being cut adrift from essential banking services.

Jenny Ross, Which? Money Editor, said:

“The bank branch network continues to shrink at an alarming rate, and the way the Access to Banking Standard is being implemented suggests that the impact of closures – particularly on vulnerable customers who rely heavily on them – is going unchecked.

“Banks cannot be allowed to treat this as a window dressing exercise. The FCA needs to review the way banks handle closures to ensure that all customers are able to access the standard of banking they require.”

Case studies

Colin Cameron is from Balfron, West Stirlingshire and is chair of the community council. Residents are battling to save its last branch, operated by the Bank of Scotland.

“Balfron is a rural community that still relies on cash, with a high proportion of older people and very limited public transport options. Many people in the local community still use the bank because they want to talk to somebody and get support they need, so it will create a huge problem when it closes.

“While the Bank of Scotland plans to offer a mobile service, no timetable has been given of when, how long or where it will be based. Parking in the village is already at a premium and the local Post Office is very small – if more than a couple of people are in there queues form out the door”.

The Bank of Scotland’s branch in Balfron has currently paused its plans to close due to the pandemic. A timetable of the mobile service was due to be made available before the new service started to operate.

Jill Smith is from Stalbridge, Dorset

“We live in a lovely part of Dorset, but with poor public transport it’s difficult for many of our elderly residents to do their banking, as the nearest branch is eight miles away. Not everyone can, or indeed wants to, use internet banking.”


· The Access to Banking Standard – supervised by the Lending Standards Board (LSB) – was introduced in August 2017. It replaced the Access to Banking Protocol which was launched in 2015. While the standard does not itself include a specific procedure for a bank to reverse a closure, banks should provide a comprehensive overview of the impact it could have on local communities. The Lending Standards Board declined to comment on Which?’s findings.

· Which? surveyed 5,116 members of its online panel that have seen one or more bank branches closing in their area between 2018 and 2020. It also surveyed 275 members of the panel of the Research Institute for Disabled Consumers (RiDC) that have seen one or more bank branches closing in their area between 2018 and 2020. Fieldwork was conducted in May 2020.

· Which? has recorded every bank branch closure since January 2015 at 21 main current account providers, relying on a number of sources. There were at least 9,803 branches operated by UK current account providers in January 2015. The number of branches has now fallen to 6,439.

· Bank branches due to close in 2020:

TSB – 82

Barclays – 59

HSBC – 28

Lloyds Banking Group has paused its plans to axe 56 branches in 2020 as a result of the coronavirus pandemic

Virgin Money is restructuring the newly acquired Clydesdale Bank network by closing 22 branches and consolidating 30

· While the Post Office provides some important banking services, it cannot help consumers if they want to open or close an account, make bank transfers, or request a replacement card – a particular problem if they are unable to use online or telephone banking and the nearest branch is several miles away.

Press Release