Banks and building societies in the UK have closed one in five branches in the last ten years despite research showing that the majority of customers still prefer to do their banking at a branch.
The study, which was conducted by Nottingham University and sponsored by the Economic and Social Research Council, found that banks and building societies closed around 4041 branches, and opened 1074 between 1995 and 2003.
Overall, the average closure rate for bank and building society branches for all areas between 1995 and 2003 was 20%. The report shows that the highest rate of closure – almost 24% – occured in less affluent inner cities and traditional manufacturing areas.
But despite the apparent closures, many high street banks claim they are actually investing in their branch networks rather than shutting them down. Barclays is currently undertaking a major revamp of 1500 of its UK branches while Alliance and Leicester (A&L) is introducing a number of new concept branches which are designed to encourage customers to use direct banking services in the branch.
A study released by Forrester Research last year shows that over half of UK customers still visit a bank branch each month and British consumers are among the most frequent branch visitors in Europe, with 55% of the 2000+ customers surveyed visiting a branch monthly, mainly for routine tasks like depositing cheques and withdrawing cash.
Earlier research by Datamonitor revealed that the UK's bank branches are the most crowded in Europe, serving on average over 5000 people per site - more than five times the average in Spain.