Is Face-to-Face Banking on the Brink of Extinction?

UK bank branch closures leave one in five consumers struggling to manage their finances.

A significant shift in retail banking infrastructure has left millions of UK consumers facing a severe reduction in physical financial services. 

The UK Government is set to launch an independent review, commissioned by Lucy Rigby, into how communities across the UK would be impacted by the closure of bank branches. 

The findings will support new powers for the government to interject in cases where access to banking is at risk. 

New Europe-wide research from CRIF, a global leader in credit information, analytics and solutions, reveals that one in five (20%) UK consumers say bank branch closures are making it harder to access the financial services they need.

The findings indicate that UK consumers are among the most affected by declining in-person banking access in Europe, a trend that carries profound implications for operational models and customer retention strategies across the financial sector.

According to data from consumer group Which?, 6,719 bank and building society branches have closed across the UK since 2015. This drastic downsizing has fundamentally altered how millions of consumers interact with their banks. 

The scale of the issue puts the UK at the forefront of this European shift. Only consumers in Ireland (20%) report a similar level of disruption, while the figures are lower in nations such as Germany (16%) and Poland (12%).

The challenge for financial institutions extends beyond physical footprint reductions to customer service access. CRIF’s research shows that just 60% of UK consumers say they can speak to a real person when applying for financial products – the lowest figure recorded across Europe. 

This sits well below the European average of 69% and a high of 79% in Poland. Furthermore, 16% of UK consumers actively disagree that they can access a human at all, which represents the highest proportion in Europe.

The generational divide

For bank executives managing digital transformation budgets, the data highlights a widening generational divide in customer experience. 

Data from CRIF also highlights that 46% of millennials say digital technology has made it easier to access banking services.

This sentiment falls to just 30% among baby boomers. This discrepancy underlines the significant challenge UK banks face in meeting increasingly divergent customer needs without alienating vulnerable demographics.

These structural shifts coincide with mounting financial pressure for many UK households, creating a complex macroeconomic backdrop for the sector. 

Nearly two in five (39%) consumers expect to have less money left at the end of each month over the next year, while 55% plan to cut their spending.

Sara Costantini, Regional Director for the UK & Ireland at CRIF, says: “The government’s new review reflects a growing issue that our research underlines: bank branch closures are leaving more consumers struggling to access the support they need, and the UK is feeling this more sharply than elsewhere in Europe.

“Advances in digital banking have delivered significant benefits, but those benefits are not being felt equally. While younger generations may be more comfortable using digital services, many older or financially vulnerable customers still value being able to speak to a person, including face-to-face, when they need help.

“At a time when financial pressures remain high, balancing digital innovation with access to human support is vital if we’re to help all consumers manage their finances and build resilience. We welcome the review and hope it leads to meaningful long-term action.”

The findings arrive as the government launches an independent Access to Banking Review to examine the real-world impact of branch closures and consider whether further intervention is needed to protect access to services.