Bank closure report: Banks failed to engage with local businesses and communities

A Holyrood committee has found that banks have failed to consult with local businesses and communities before closing branches across Scotland.

An inquiry was set up by the Scottish Parliament’s economy, jobs and fair work committee in March to look into the closure of more than a third of Scotland’s bank branches since 2010.

Its final report concludes that bank closures have had an impact on vulnerable people where alternative options to face-to-face banking have not been adequate.

The committee took evidence from an extensive range of community representatives, organisations like credit unions and community councils, and the banks themselves, to examine the impact of closures on businesses and consumers, and to hold banks to account.

It also reflected evidence heard from people in towns which have suffered from the loss of a last bank, and with buildings still standing empty.

A short chapter of the report is dedicated to Royal Bank of Scotland branch closures, though the committee stresses that it “is not focusing on branch closures by one specific bank”.

Gordon Lindhurst, convener of the committee, said: “There has been significant public concern about the extent of Scottish bank branch closures. After hearing from a wide range of people during the course of the committee inquiry, we are in no doubt that the loss of branches has had a negative impact on communities and businesses across Scotland.

“People told us that they feel abandoned by the banks following branch closures with alternatives offered by the banks often not meeting their needs. It is vital that people have access to cash and face-to-face banking services. The Committee believes that banks must engage with people and businesses on their needs before deciding to close a branch. The UK Government should urgently carry out a full study into the effects on communities.”