Barclays bank has announced an additional 54 branch closures by the end year, but has been warned its attempt to cut costs and streamline services threatens small business survival in hard-hit areas.
Following the 14 branches already closed by Barclays in 2017, the latest closures will occur in December.
Referencing the capabilities of online banking, a Barclays spokesperson maintained that further branch closures reflected a rebalancing of services, while its network of in-store branches would remain “a vital part of our offering”.
“With customers visiting our branches less and less each year, we must constantly assess how and why our branches are used and make decisions based on that insight,” she added.
However, the Federation of Small Businesses (FSB) has warned that Britain’s small company owners have continued to lose out most from branch closures, and would face a number of damaging consequences from the latest announcement.
“At a time of unprecedented uncertainty, the last thing small businesses need is loss of in-person bank branch support. When times are tough, there’s no replacement for help from a known and trusted bank branch contact,” said FSB chairman Mike Cherry
Rapid bank closures have seen Britain’s network of branches halve in the last 25 years to just 8,000, and a further 50 per cent is predicted in the next ten years. To access certain banking services, small business owners have been advised to use Post Offices.
The British Bankers’ Association pledged in November 2016 to ensure greater collaboration between banks and local Post Offices to compensate business customers for the loss of in-store services.
However, Cherry said alternatives like the Post Office were “simply not up to scratch”, with services such as cheque clearing facilities and currency exchanges rarely available.
“We need to see substantial improvement and standardisation of the Post Office’s offering if it’s to be considered a viable replacement for bank branches,” he added.
Another threat to small firms has been the possibility of a physical cash shortage – an issue causing particular concern in areas dependent on tourism.
“Our members routinely deal with customers that want to pay in cash,” Cherry said.
“Once a town loses a bank branch it hurts footfall, particularly in tourist hotspots, and means business owners have to spend time travelling out of town to use banking services.
“Card payment terminals can go some way to mitigating these impacts but still carry multiple transaction costs which firms are forced to absorb.”
Barclays’ new branch closures will take place in between September and December, including the below locations.
- Birkenhead Higher Tranmere
- Bristol Bishopston
- Combe Down
PayPal told Business Advice how it plans to plug the gap left by bank branch closures
Sign up to our newsletter to get the latest from Business Advice.