/ Money

Are local bank branches doomed?

A new report on banking published this week suggests that the day of the bank branch is coming to an end. But as we look set to lose half of the nation’s branches, can we really say we’ll miss them?

The report from Jones Lang LaSalle predicts that ‘the age of the big branch legacy network in developed world countries is drawing to a close… as many as 50% of branches in networks may be declared obsolete in their current form by the decade’s end’.

The reasons behind the dramatic number of bank branch closures are varied, but internet banking is at the top of the list. After all, if you bank online, do you really need a branch in the high street? In which case, does it matter if they’re sold off to pizza chains or coffee shops (as so many seem to have been)?

Cutting back branches

In the UK, we’ve already seen a significant number of branch closures. They’ve been happening for years and look certain to continue. The Campaign for Banking Services, which has been monitoring the decline, predicts that the total number of branches in the UK will fall from 9,550 today to 8,000 in 2018.

Although several banks such as Barclays, LloydsTSB and RBS have promised not to close the ‘last bank in town’ (or at least within four miles of it), HSBC has not joined them and is expected to close at least 47 branches this year.

Which? Conversation commenter Pickle told us she was sold on the value of bank branches:

‘My high street branch is VITAL. Internet banking is all very well, but has its snags – what if my internet service goes down, what if my computer packs up,  what if I have a power cut?’

New branches growing

In London and the South East, new banks such as Metro are bucking the trend by opening extra branches. But what about the rest of the country? For me, Marks and Spencer seems to be the shape of things to come, as it recently announced plans to open 50 in-store banks over the next two years.

Commenter William admitted he wasn’t convinced:

‘Well I for one won’t be tempted to switch to an M&S bank as I don’t see it as being any different from all the rest. Having a bank effectively split, I can foresee emails exchanges along the lines of “it’s not our problem”, “oh yes it is”, “oh no its not”, and the only loser in that scenario is the customer.’

The Co-operative Bank is another provider that’s expanding. Having announced a deal with LloydsTSB to take over 630 of its branches, it will soon have 10% of the UK market (900 branches).

Bashing banks is an easy sport, but I have to admit I’d be sorry if high street branches totally disappeared! But would you miss your local branch? Is it within easy walking distance? And when was the last time you visited?


Last time I visited a bank branch was about 6 months – 9 months ago. I must admit I hate being made to wait to speak someone, just because they could only be bothered to have one out of 3 tills staffed. Even though having no bank branches wouldn’t unduly affect me, there are I’m sure millions in this country who rely on them. And as more banking scandals are exposed and those revenue streams are closed I’m sure the banks will take the short sighted view of closing more branches. Sadly, and I’ve mentioned this on other convo’s, most companies operating in this country are only interested in making money and not providing a service.


Hopefully a reduction in bank branches will encourage a further decline in the use of cheques, which are still unreasonably used by many businesses as their default method for outgoing payments. I am fed up with businesses who owe me money insisting on sending me a cheque, which causes me unnecessary inconvenience in having to visit a bank branch to deposit it.


Sadly, reducing the number of bank branches would have no effect on the companies that send out cheques, in fact it may well encourage more to do so, if they can see extra interest on money they’ve paid up just because it could take longer to pay a cheque in. I wonder if we’re allowed to start charging an admin fee for our time and effort in finding an open branch and paying in a cheque, now that might help reduce the number of cheques being issued.


The phasing out of cheques has been debated extensively, including on Which? Conversation. They cannot sensibly be phased out until a suitable alternative is provided. Business might survive without them, but they are essential for many charities. You can choose which businesses you deal with, nfh, but please spare a thought for charities even if you have no personal involvement. I work for a charity and would rather handle cheques than hundreds of pounds of assorted cash, but both are extremely welcome. It would be nice to get more standing orders and bank transfers, but those represent a relatively minor contribution to the funds I deal with.


Charities can accept bank transfers; cheques are no longer necessary. Bank tranfers can be initiated online, by telephone, or by person in a branch (for those who still insist on branch banking). Cheques are unnecessary and an unreasonable burden on the recipient.


I am well aware of this, nfh, and the charity that I’m involved in has been encouraging this for years. However, most of the donations that I process are cash and some are cheques. You do what you want, but please accept that cheques are very important to charities. There are a couple of Which? Conversations where this is made abundantly clear. I give a lot of my time to a charity and so does our treasurer, who is happy to process any number of cheques, Gift Aid forms, etc.


It is not necessary to visit a branch every time you want to pay in a cheque. I have been paying cheques into my bank account by post for years and I think most banks have this facility. Nevertheless, I would be very sorry if any of the major banks embarked on large-scale branch closures. It is frequently necessary [and usually more effective] to speak to someone over a transactional matter than try to wrangle it over the phone, on-line or by post – especially if documentation is involved. Obviously, the internet has led to a big reduction in the number of cheques and cash withdrawals being handled by branches but they still fulfill a major role in cash-handling and general banking for the local traders. I still issue a surprising number of cheques a year for things ordered by post, various commercial payments, balancing payments to utilities, and so on. Many of these could be done through interbank transfers but I have experienced reconcilaition problems in the past and the denial of receipts clearly debited from my account. Charities, small businesses, holiday homes to let, and numerous other concerns could not function without cheques [or an effective substitute if such can be devised] and where there are cheques there should be bank branches.


I don’t receive many cheques nowadays. There is usually a queue at my bank (showing that there is still a demand) so I just pop an envelope in their letterbox, saving postage. The branch is conveniently located and I don’t have to make a special journey.


Those who continue to use branches to deposit cheques should pay for the privilege; it’s an unnecessary waste of resources. Any account holder who can receive a cheque can also receive a bank transfer. Similarly any account holder who can issue a cheque can also send a bank transfer. It makes no difference whether the account holder is an individual, a business or a charity. Other countries’ banking systems function perfectly without cheques. Cheques are no longer necessary and branches should not be kept open in order to process them.