Demise of high street banks threatens small business prosperity
The acceleration of bank branch closures in the UK is failing to be countered by effective banking alternatives for small business owners, a new study by the Federation of Small Businesses (FSB) has found.
According to the report, the total size of the bank branch network has halved to just over 8, 000 branches in the last 25 years with a further 50 per cent cut predicted in the next ten years.
The organisation claimed that the branch closure programmes of the UK’s high street banks posed a serious threat to the ability of small firm owners to access efficient and reliable banking, subsequently hitting productivity levels.
The research suggested that shortcomings in infrastructure and training have failed to provide widespread digital banking access for small business owners.
National chairman of the FSB, Mike Cherry, urged banks to work with the government to assess the impact of closures through effective monitoring, and create greater transparency on small business access to banking services.
the rapidpace of bank branch closures across the UK presents some very real and tough challenges for small businesses, Cherry said in a statement.
fSB members highly value the face-to-face interaction they receive in-branch, particularly when making complex financial transactions, with staff who oftenhave a greater understanding of their business and the local economy.
The study suggested the value in face-to-face interaction that a bank’s in-branch serviceisable to provide, alongside expert advice in complex financial transactions, as well as the expertise in the local economy.
in addition, many of our members deal heavily in cash and cheques and need access to over-the-counterbanking facilities on a regular basis, Cherry added.
Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.