30 May: More Barclays Branches ‘Casualties of Digital’
Barclays has announced the closure of a further 27 branches in addition to the 13 that it announced in March would be shutting down. Having already shut 63 branches since the start of the year, the latest announcement will bring the bank’s total branch closures in 2022 to more than 100.
Barclays cited the rise in banking via digital channels as the reason behind the closures, with its digital customers growing to 10 million over the last nine years. It estimates that over 70% of transactions can now be carried out digitally, and said that fewer than 10% of transactions are currently carried out in branches.
A Barclays spokesperson said: “We continue to review and adjust our branch footprint to ensure it reflects the way that our customers are increasingly choosing to do their banking.
“We will always give 12 weeks’ notice of any branch closures, explaining the rationale for the decision, as well as highlighting alternative branches and ways to bank.”
Barclays has pledged to work with communities to find alternative ways to provide local banking support. This includes use of the Post Office and adding to its existing 50 ‘pop-up branches’ across the country in locations such as community centres, libraries and business hubs.
26 May: ‘Gen Z’ Leaves Physical Wallets At Home To Pay By Phone
Mobile phone payments are on the rise, with 61% of consumers now saying they are confident leaving their wallet at home and are instead paying with their phone, according to research by card issuer, Marqueta.
The survey found that Gen Z consumers – those born between 1997 and 2012 – were the most enthusiastic about mobile payments. More than three quarters (77%) of Gen Z respondents said they can happily go about their day relying solely on mobile payment platforms, such as Apple Pay and Google Pay.
Nearly 8 in 10 (77%) of UK consumers said they have used some sort of mobile wallet at least once in the last 12 months.
Of these, 83% feel they can purchase whatever they need with a digital wallet, and a further 64% actually prefer to pay with their phone because it has more built-in security features such as face or fingerprint identification.
Anna Porra, European strategy director at Marqeta, said: “Confidence in mobile wallets is growing, and people feel increasingly comfortable that their mobile phone can handle their payments and not leave them stranded.”
Contactless becoming norm
Marqeta’s survey of 4,000 consumers across the UK, USA and Australia, also revealed that, when consumers do bring a physical wallet, the majority rely on contactless payments rather than cash or chip & PIN.
Almost all – 96% – of UK consumers said they had made a contactless payment in the last year. Of these, 42% said they have been making contactless payments for so long they have even forgotten their PIN. Among UK respondents under the age of 24, this rises to 54%.
Regardless of their age, the majority of UK respondents – 63% – say needing to enter their PIN while making a payment is irritating.
The majority of consumers found cash equally outdated. 63% of survey respondents expect cash to eventually disappear altogether. Of these consumers, 59% expect the disappearance of cash to happen within the next five to 10 years.
Ms Porra said: “While the pandemic was the catalyst for the shift to contactless and mobile wallets, it is the convenience, security, and speed of these payment options that have made them sticky.”
Physical banking in decline
Most consumers were found to prefer digital banking as well as digital payments. In the UK, 46% say they can ‘count on their hands’ how many times they have used a physical bank in their lifetime.
About a third (33%) went so far as to say it would have no impact on their lives if all the UK’s physical bank branches closed tomorrow.
For UK respondents aged 18 to 24, the concept of in-person banking is even less familiar: 50% of this group said the idea of visiting a physical bank branch was ‘completely alien’ to them.
Despite their lack of enthusiasm for in-person banking, the majority of respondents said they want more personalization from their banks: 80% of consumers said they want their bank to offer them more personal rewards, while 60% would like their bank to provide tailored budgeting advice.
A significant number of consumers were equally interested in how cryptocurrencies could be incorporated into their day-to-day financial lives. Marquette found that 26% of UK consumers own cryptocurrency, and of those who do 82% are interested in using it in the same way as they would a debit card at point of sale.
10 May: New laws to protect access to cash and help scam victims
The Financial Services and Markets Bill announced in today’s Queen’s Speech will ensure the continued availability of cash withdrawal and deposit facilities across the UK. The stated aim is to make sure the country’s cash infrastructure is “sustainable for the long term”.
In the face of largescale closure of bank branches across the UK (see stories below), the government has acknowledged that cash remains an important payment method “for millions of people across the UK, particularly those in vulnerable groups”.
Further details will be provided on the mechanics of maintaining the cash infrastructure when the Bill is published.
The Bill will also enable the Payment Systems Regulator to force banks to reimburse victims of authorized push payment (APP) scams, which are thought to cost hundreds of millions of pounds each year. This is to ensure victims are not left paying for fraud through no fault of their own.
24 March: Lloyds Follows HSBC With Swingeing Branch Closure Programme
Multi-brand financial institution Lloyds Banking Group is to close 60 branches – 24 Lloyds Bank, 19 Bank of Scotland and 17 Halifax.
It cites a reduction in branch usage for the cull, saying online banking usage is at a record high in 2022. Rival bank HSBC gave the same reasons for its decision, announced last week, to close 69 branches later this year (see story and details below).
Lloyds says it has 18.6 million regular online banking customers and over 15 million mobile app users, with the numbers increasing by 12% and 27% respectively in the last two years.
It says all the branches slated to close continue to have alternative banking and cash access within one mile.
Vim Maru, a director of Lloyds Banking Group, said: “Just like many other high street businesses, fewer customers are choosing to visit our branches. Our branch network is an important way for us to support our customers, but we need to adapt to the significant growth in customers choosing to do most of their everyday online banking.”
Lloyds Bank Group branch closure details
HSBC Closes 69 Branches
HSBC is to close 69 of its 510 UK branches between July and October this year. The bank says less than half its 14.75 million customers actively use its branch network, with the average footfall declining over 50% since 2017.
It attributes this to the growing popularity of mobile and online banking – a trend exacerbated by the restrictions associated with the coronavirus pandemic.
Jackie Uhi, head of HSBC UK’s branch network, said: “The way people bank is changing – something the pandemic has accelerated.
“We know that the majority of our customers have a preference to do much of their day-to-day banking online or via mobile, so we’re removing locations where we have another branch nearby, and where there is a significant reduction in customers using face-to-face branch servicing.”
HSBC customers are able to carry out day-to-day banking transactions at Post Office branches. The bank says all of the branches that are closing this year have a Post Office within 1.5 miles, 97% of which are within one mile.
For customers concerned about retaining access to cash, 90% of the closing 69 branches have 10 or more free-to-use ATMs within one mile, with all closing branches having at least five.
The bank says it is working with ATM provider LINK and the Cash Action Group on an industry-wide effort to provide banking services in areas where branches are no longer viable.
Following the closures, HSBC UK will have a branch network of 441 branches in the following formats:
- 96 full service branches offering a full range of services, predominantly based within large cities and towns where branches see a broad range of requests.
- 172 cash service branches supporting communities that have a greater need for access to cash, alongside over-the-counter servicing and the ability to deal with complex issues such as bereavement and Power of Attorney.
- 173 digital service branches providing ‘traditional’ cash and check transactions and access to other products using self-service technology.
The full list of closures is below: