UK Bank Branch Closures Accelerate, with 1 in 3 Shuttered in Last 5 Years

Banks have shut one in three branches across the UK over the last five years, leaving just 6,870 branches open. The UK has among the highest rates of bank closures in Europe, with Spain and the Netherlands reporting higher proportions. Banks are cutting costs and focusing on digital offerings, while facing competition from challenger banks. The decline of bank branches and free ATMs has sparked concerns about a potential decline in cash acceptance.

The number of bank, credit union, and building society branches in the UK has declined by 34% over the last five years, according to data from the Office of National Statistics (ONS). This rapid closure rate has left the UK with just 6,870 branches open [1]. The decline has been particularly pronounced in 2024, with a 10.4% fall in branches compared to the previous year [1].

Major financial institutions such as Lloyds, NatWest, Halifax, and the Bank of Scotland have announced plans to close a further 113 branches by November 2025 [1]. In March 2025, Santander also announced the closure of 95 of its 444 UK branches, citing a significant shift in customer behavior towards digital banking [1]. The Spanish bank reported a 63% increase in digital transactions since 2019, while branch-based transactions decreased by 61% over the same period [1].

The UK's rate of bank branch closures is among the highest in Europe. Spain and the Netherlands have seen even higher proportions of branch closures, losing 37% and 48% of their branch networks, respectively [1]. As of 2025, there is one bank branch per 2.5 people in Spain and Portugal, and 4.9 in France, compared to one branch per 10,000 people in the UK [1].

The closure of bank branches and free ATMs has sparked concerns about a potential decline in cash acceptance. This shift towards digital banking has been driven by cost-cutting measures and a focus on digital offerings, as well as competition from challenger banks.

In contrast, the Indian banking sector has been consolidating its operations. The Indian government has merged 27 public sector banks into 12, aiming to enhance operational efficiency and reduce policy risks [2]. The FE Best Banks Awards, an annual event recognizing excellence in the banking sector, have highlighted the resilience and digital transformation of Indian banks [2].

The decline in bank branches in the UK is a clear indicator of the evolving financial landscape, driven by technological advancements and changing consumer preferences. As banks continue to adapt, the focus on digital services and cost efficiency is likely to shape the future of the banking industry.

References:

[1] https://moneyage.co.uk/uk-bank-branch-numbers-decline-rapidly-in-five-years-figures-show.php
[2] https://www.financialexpress.com/fe-best-banks/