UK proposes tighter restrictions on bank branch closures

Reuters. – On Tuesday, the Financial Conduct Authority suggested that British banks will have to provide a more detailed analysis to justify closing a branch, reducing working hours or switching from a free ATM to a paid one.

The British Parliament is concerned that vulnerable customers, particularly in rural areas, are having difficulty getting to a bank branch and getting cash.

Contactless transactions and cards have overtaken cash as the most popular way to make a payment.

The Financial Conduct Authority (FCA) already issued guidance to banks in September 2020 on how to handle any branch closures, but the watchdog said on Tuesday that some banks were “staying short” of what they should do.

The agency is proposing a stricter version of the guidelines to include partial branch closures, such as reducing working hours and services, such as removing the counter.

“We know that in some cases companies are making the decision to close branches that are still used by a large number of customers,” the FCA said in a statement.

“We have also seen companies take the decision to cancel facilities such as teller services from branches, or permanently and significantly reduce branch opening hours.”

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He said some banks and building societies are not doing enough to properly understand the impact of these changes and to keep their customers informed.

“Expanding contacts to other groups, such as local charities and local councils, to account for the broader impact of changes to services is also included in the proposals,” the FCA said.

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Last month, Britain’s Chancellor of the Exchequer proposed legislation giving the Financial Conduct Authority (FCA) new powers to protect “cash access” and ensure the continued availability of domestic deposit and withdrawal services.

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