We are told banks are closing their branches to increase their profitability and to redirect investment as customers increasingly shun physical branches and move to online banking.

Looking across Cambridgeshire, our access to banking facilities is diminishing year on year. St Neots lost three bank branches in 2023 and is due to lose another branch in 2024. March lost one branch in 2023 with a further branch due to close during 2024. Littleport’s last bank closed in 2015 and, more recently, in May 2019, Soham’s last bank closed its doors for good, leaving both these towns without any banking facilities except at their Post Offices. Customers were redirected to other bank branches across the District but now the news that Barclays plans to close its branches in Ely and Newmarket has been met with anger and disappointment by many across our communities.

There are real concerns regarding how these closures impact our communities. Firstly, people are being asked to trek to another town with a bank branch such as Cambridge, but affordable and efficient public transport is not necessarily available. Making the journey to another town is not an easy task for the elderly or parents with small children. Secondly, elderly, vulnerable or people on a low income cannot always access internet banking easily. Many do not have access to a fast broadband connection or a computer and strong signals for smart phones are not available everywhere. Computers in local libraries are not secure and online fraud is a major risk.

One solution put forward is moving to a cashless society through use of ‘plastic money’ meaning access to banks and cash machines are not needed. However, cash cannot be totally replaced as, according to the Financial Conduct Authority (FCA), in 2023 there were around 1.1 million adults in the UK currently living their lives “unbanked” meaning they do not have a bank account. It must be concluded that people without computers, smartphones and private transport can’t now easily access financial services.

These closures are also another blow to our towns’ already struggling highstreets as evidence suggests that the closure of bank branches increases commercial decline of villages and town centres, as better-off and mobile people travel to other towns and change their spending habits. The loss of the customer base for the local economy makes it difficult for local councils to regenerate town centres and for local businesses to secure finance for new start-ups or support for tougher times.

The Financial Services and Markets Act 2023 saw the government introduced a new law to protect, for the first time, reasonable cash access through withdrawal and deposit facilities. The new Act also gives the Financial Conduct Authority responsibility for overseeing the maintenance of a well-functioning cash system.

At Cambridgeshire ACRE, we ask for the rules on bank branch closures to be changed to ensure better consultation and involvement of local communities before any closure takes place. Banks must demonstrate that after branch closures, the local population’s access to banking and financial services will not be worse-off. This is so alternatives, such as mobile bank branches; branches within shops and post offices can be explored and provided in the community.

Looking to the future Cash Access UK a not-for-profit company owned and funded by nine major high street banking providers is working with communities to establish ‘Banking Hubs’ – a shared banking space on the high street. Hubs offer a counter service operated by the Post Office, where customers of all major banks and building societies can carry out regular cash transactions, Monday to Friday. The Hubs also offer a Community Banker service where customers can talk to their own banking provider about more complicated banking issues. The Community Bankers work on rotation, with a different banking provider available on each day of the week. Community Bankers are usually provided by the banks or building society with the most customers in the local area.

The first stage for considering a banking hub is an application to LINK by a member of the public, part of a community group or councillor, to ask for a review of your community’s cash access needs. LINK is the organisation responsible for the UK’s ATM network. LINK will look at a wide range of factors to decide whether your community needs a new cash service. They will look at which cash and banking services are already available to the community. But they will also look carefully at other factors including the community’s size and age profile, the number of local businesses, the take-up of digital services and the number of people who are likely to rely on cash.

Once they have carried out an assessment, LINK may say that your community is already well-served for cash access, or they can recommend a Banking Hub or a new deposit service. If a Banking Hub is recommended, then Cash Access UK will work with your community to find the best place to open its doors. To access further information about a LINK cash assessment and/or setting up a banking hub please contact Cash Access UK.