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20 October 2016

Bank branches closing faster in Scotland

Reference number: SPUR2010

Bank branches are closing at a faster rate in Scotland than in England, Wales and Northern Ireland, figures unearthed by the Federation of Small Businesses (FSB) show.

Statistics from the Competition and Market Authority show that, between 2013 and 2014, the number of bank branches north of the border fell by 7.7 per cent – from 1,123 to 1,037. Over the same period, the number of branches in England fell by 5.0 per cent, 5.7 per cent in Wales and 6.4 per cent in Northern Ireland.

It is estimated that there are 8,300 UK bank branches left – with some predictions that this figure will drop by half over the next decade. FSB is writing to the Scottish Government and banking chiefs north of the border asking for their views on how to minimise the impact of this trend.

The figures are contained in a new report from FSB that reveals that branch closures are damaging local economies and making it harder for firms to access to banking services.

The study features evidence provided by smaller firms in Lochinver and Invergordon, alongside stories from firms in places like Glastonbury, Conwyn and Sturminster Newton.

Businesses highlight the practical problems associated with travelling further to get change and to deposit cash or cheques. Firms also cite their preference for face-to-face interaction when seeking business advice about growth and finance.

In addition, the report looks at the negative impact branch closures can have on footfall in town centres. The report finds that branch closures combined with poorly maintained ATMs can harm the circulation of cash around local areas.

Andy Willox, FSB’s Scottish policy convenor, said: “Banks are disappearing from Scottish high streets and this poses problems for both local firms and communities.

“We recognise that more businesses are using online banking. But, as our report highlights, these services don’t fill the gap left by boarded-up branches. Further, because Scotland lags behind England in terms of both mobile and broadband coverage, the impact of the withdrawal of local services is exacerbated.

“It is unfortunate too that other large private and public bodies are choosing to consolidate their estates and withdraw to urban centres. In our view, there’s insufficient scrutiny of the local economic impact of these closures and the cumulative impact is significant. This is an area where we expect leadership from councils and the Scottish Government.”

 

ENDS