A report from David Black, a banking and financial services insight analyst, commissioned by The Nottingham Building Society, has revealed that this figure represents over 25% of the remaining network of bank and building society branches in the UK. An estimated 879 bank branches closed last year.
The study has found that 29% of people expect the rate of branch closures to increase ‘dramatically’ over the next three years, and 49% think there will be a slight increase.
Almost 90% of people feel there is still a key role for branches to play, but this needs to be ‘reinvented’. Only five per cent of people interviewed feel branches have no future.
One in four people believe if their local bank or building society branch closed, they would suffer from ‘financial exclusion’ as they would have less access to advice and financial products and services.
Almost 53% said they would use branch-based savings accounts, followed by 32% who would use independent financial advice in-house.
Just over one in five said that they would be happy to use a branch-based whole of market mortgage advice service and nine per cent would use a local estate agency service based in bank and building society branches.
David Marlow, chief executive officer of The Nottingham Building Society, said: “This report echoes what we are seeing on the high street, branches that are solely focused on transactional offerings have a limited future. We have reinvented our branch proposition to offer a far wider range of services. This includes financial advice, whole of market mortgage comparison, savings accounts and estate agency services at selected branches.
“Since doing this, our footfall has increased by around 10%, and our membership has grown, along with mortgage applications and savings balances. Our membership approval rating is currently at 79%, which places us amongst the best organisations in the world from a customer satisfaction point of view.”
Kevin Roberts, director at Legal and General Mortgage Club, commented: “As more and more branches close, reduced access to face-to-face advice is clearly becoming a growing issue. Particularly for those who pop down to their local branch as part of their financial routine, who are they going to rely on now? We believe that brokers have a valuable role to play here in filling this gap, although they will need to overcome the challenge of promoting their services.
“Our Value of a Broker research showed that only 44% of consumers identified that a broker works primarily for the borrower, and less than half understand brokers have access to thousands more products than going directly to a bank.”