The petition of residents of Suffolk Coastal and the wider Suffolk area,
Declares that Barclays Bank has stated it will close its Leiston branch; further that this means Barclays will have closed all of its branches in Suffolk Coastal including Aldeburgh, Felixstowe, Halesworth, Martlesham Heath, Saxmundham, Southwold and Woodbridge; further that the petitioners believe that rural areas like Suffolk are more likely to be at risk of bank closures; further recognises the powers of the Financial Conduct Authority given under the Financial Services and Markets Act 2023 regarding access to cash and bank closures; and further that it is concerned at the validity of the assessment of the justification of closure by Barclays.
The petitioners therefore request that the House of Commons urges the Government to encourage Barclays to keep open their last remaining branch in Leiston is Suffolk Coastal; and to require the Financial Conduct Authority to publish its assessment of the justification given by Barclays for closure of its Leiston Branch.
And the petitioners remain, etc.—[Presented by Dr Thérèse Coffey, Official Report, 20 March 2024; Vol. 747, c. 1013.]
[P002936]
Observations from the Economic Secretary to the Treasury (Bim Afolami):
I thank my right hon. Friend the Member for Suffolk Coastal (Dr Coffey) for submitting the petition on behalf of her constituents regarding the closure of the Leiston branch of Barclays. I am sorry to hear of her constituents’ disappointment at the planned closure of the branch. The Government believe that all customers, wherever they live, should have appropriate access to banking and cash services, and I would like to assure her that I am monitoring this issue closely. Banks and building societies occupy a privileged position in society and are essential to enabling people to manage their money on a day-to-day basis.
The Government legislated through the Financial Services and Markets Act 2023 to introduce a new legislative framework to protect access to cash for individuals and businesses. This establishes the Financial Conduct Authority as the lead regulator for access to cash and provides it with responsibility and powers to seek to ensure reasonable provision of cash withdrawal and deposit facilities. As part of this responsibility, the FCA must seek to ensure that there is reasonable provision of free withdrawal and deposit facilities in relation to personal current accounts. The FCA recently consulted on its proposed regulatory regime: FCA consultation on access to cash.
For access to banking services more broadly, while the Government acknowledge that decisions to open or close a branch are commercial decisions for banks, it is imperative that banks and building societies recognise the needs of all their customers, including those who need to use in-person services. The impact of branch closures must be mitigated where possible so that all customers, wherever they live, continue to have appropriate access to banking services.
Guidance from the FCA sets out its expectation of firms when they are deciding to reduce the number of their physical branches or free-to-use ATMs. Under this guidance, firms are expected to communicate their decision to close a branch clearly to their customers and other relevant stakeholders at least 12 weeks before the proposed closure. Before this, firms are expected to conduct analysis of the needs of customers using the site, the impact of a planned closure and alternatives that are or could reasonably be put in place to continue to meet those customers’ needs. The FCA expects this analysis to include usage trends, overall transaction volumes across a representative time period, and details of any commercial evaluation the firm has completed. Firms are expected to publish a high-level summary of this analysis, though the FCA does not expect firms to publish information that is confidential.
Alternative options to access everyday banking services can be via telephone banking, through digital means such as mobile or online banking, and via the Post Office or banking hubs. The Post Office allows personal and business customers to carry out everyday banking services at 11,500 post office branches across the UK, and banking hubs are a shared initiative which enable customers of participating banks to access cash and banking services in shared facilities. Over 100 banking hubs have been announced so far and UK Finance recently confirmed that it estimates that a total of 225 banking hub locations will be announced by the end of 2024. Over 40 hubs have already opened, and the Government hope to see the other hubs open as soon as possible. In an Adjournment debate on 24 April 2024, I stated that I would like the criteria to be adjusted to better take the needs of rural areas into account.
Following my recent discussions the with the banking sector, I welcome the participating high street banks’ voluntary commitments to a range of improvements to the banking services provided in hubs. This includes all firms agreeing to provide a consistent range of banking services in hubs, and that customers will not need to bring their own smart device to carry out a service. Firms will trial customer liaison services and Saturday openings, and have also committed to keep services in banking hubs under review, ensuring hubs continue to be fit for purpose for all customers.
I thank my right hon. Friend for highlighting the concerns of her constituents in this area.