Bank Closures and Banking Hubs

Nusrat Ghani Excerpts

Thursday 5th June 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. We have shy of 30 Members hoping to contribute, so we will have a hard speaking limit of four minutes to begin with.

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[Esther McVey]

I agree—the lack of banks is a disgrace. Where do people go for their banking needs? The reality is that the banks that are closing have entered into an agreement with businesses and individuals; when they opened their bank account, they opened it with the bank on the high street. The business was there because it expected a certain amount of customer service—that is why they went there in the first place. Face-to-face banking offers confidence, security and efficiency, especially for businesses handing over cash and making significant financial decisions. Without those services, it just will not work.

In 2022, the Federation of Small Businesses found that four in 10 small businesses still relied on cash as a primary payment, and six in 10 needed to make regular cash deposits. I regularly hear from businesses in Tatton that they simply cannot deposit cash or access the basic services needed. Why? Well, that is because 64% of bank branches have closed in the last decade and 65% of cashpoints have gone. That is reducing the ability of businesses to deposit cash in the local area. The shift to online poses risks from technical failures and cyber-attacks. We have heard that through this monopoly and lack of access, there is a squeeze, and commission is being charged for the transactions of these businesses.

Our high streets are at the heart of our communities, but without access to banking services, our high streets, which are already under pressure, have become even harder places to trade, grow and thrive. If we are serious about supporting small businesses and seeing investment on our local high streets and in our town centres, we must stop the decline in banking infrastructure.

Some may argue that closures would be reasonable if banks were losing money and needed to take cost-cutting measures, but that is simply not the case. Banks are not struggling institutions. Last year, HSBC reported nearly $25 billion in post-tax profits. Barclays made $6.4 billion. Lloyds made $4.5 billion. NatWest made $4.8 billion. Those are all eye-watering profits—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order.

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[John Whitby (Derbyshire Dales) (Lab)]

Cash is still alive and well, and for some, access to it is still a necessity—indeed, last year £80 billion in cash was withdrawn from the Link network. However, with the rise and rise of internet banking and contactless payments, we have seen a near-complete withdrawal of bank branches from certain parts of the country. As has been mentioned, there were 10,000 branches 10 years ago; now, there are just 3,000. One of those closures was the NatWest bank in Bakewell, in February 2024. It was not just the last bank in Bakewell; it was the last bank in the entire Peak District national park. In a few weeks’ time, when the Lloyds bank in Ashbourne closes, there will be no banks in the entire Derbyshire Dales constituency—an area of nearly 400 square miles.

There are many reasons why people need access to cash, all of which are ably demonstrated by the magnificent market town of Bakewell. Of course, there are residents there on low incomes or benefits, who find it much easier to budget using cash and are less likely to have access to the internet. There is an ageing population there who simply will not want to change, or do not trust the technology. We have had elderly residents taking two-hour round trips on the bus simply to withdraw cash from what was their new nearest bank, rather than use the ATMs in Bakewell. There are several successful markets each week; the traders will all have electronic card readers to take payments with, but despite what the mobile networks may say, people struggle to get a signal in Bakewell and traders often have to ask shoppers to pay in cash. There are also numerous independent shops that serve Bakewell’s 6 million visitors. Those shops need cash to run, and when they queued up for cash at the post office they found that they were being rationed, as it simply could not cope with the demand.

Despite all its attributes, Bakewell was turned down for a banking hub the first time around. When I was elected, I went back to Link, which does the assessments and makes the decisions on banking hubs. Over the course of several conversations, I tried to understand what had been missed the first time around. I have to say that Link was very responsive, and after we had submitted another application following a slight relaxation of its criteria on population size, its representatives were happy to come back to Bakewell. I took them to the agricultural business centre to see the livestock markets, where the auctioneers demonstrated to them the staggering number of transactions taking place using cheques. This, I am glad to say, seemed to be the missing part of the puzzle. Back in December, we were told that we had been given a full counter service banking hub—it was the best Christmas present ever.

The experience in Ashbourne was completely different, showing that one size does not fit all. The process there was seamless: Lloyds announced that it would close, an assessment was done, the criteria were all met, and I liaised with Cash Access UK over timeframes, locations and so on. I am very glad to say that the permanent Ashbourne banking hub will open on 27 June, and it looks like the permanent Bakewell hub will follow towards the end of July. This will continue the excellent work and growing reputation of the temporary Bakewell hub.

A national Cash Access UK report suggests that over 90% of customers believe that banking hubs are extremely important to the community, and the feedback that I get from service users is all positive. The evidence suggests that banking hubs increase footfall and boost the local economy, and I am very relieved that we will shortly have two in the Derbyshire Dales.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

The speaking limit is now three minutes. I call David Mundell.

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[Jon Trickett (Normanton and Hemsworth) (Lab)]

The banks have more or less abandoned my constituency, and it sounds like that is the case for many others. Some 6,500 branches have closed in recent years, as have more than 200 post offices. There are 23 separate settlements in my constituency with no access to banking. We do have banking hubs. It is an hour each way by bus to get to one, and it costs at least six quid to get there and back. I represent large numbers of people living in poverty, and it is hard for them to raise that kind of money just to have access to banking services.

I will make two other points about my constituency and then a general point. The bus services are very poor. As I have just said, it can take an hour each way to get to the banking hub, and the banking hub does not provide all the services that a bank should provide.

My other point about my constituency is that there are 15 zones for the internet, and 11 of those 15 zones are among the worst for internet provision in the country. How on earth is someone supposed to access banking on an internet system that is simply not working? It shows the extent to which Britain’s infrastructure is creaking, and it is not acceptable that banks should abandon the people who helped to create them in the first place.

I will just make this final point about mobility and accessibility. One in four households in my constituency has no access at all to a vehicle. That is more than 20,000 people without a van or a car to get them to a bank, even if a bank were available. It is a disgrace that the banks have turned their backs on all those people who were their loyal customers for so many years. Businesses that rely on cash and collect cash each day have nowhere to deposit it. People are driving home from their place of work or their business with cash in the boot and nowhere safe to put it. That is a dangerous thing.

It is odd, ideologically, to hear Members from the party of free enterprise and the free market saying, “We have to do something about capitalism withdrawing from communities.” That is what is happening, and that is the nature of capitalism itself. We should just say that the financial sector in this country is worth £17 trillion, which dwarfs our GDP of £2.5 trillion. The banks are worth eight times more than the total output of the whole UK. As we have heard elsewhere, £44 billion of profit has been made by the banks in recent years. It is time we brought the banks to order to serve our communities—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. I call Helen Morgan. [Interruption.]