MP proposes new law to stop people being left high-and-dry by bank closures

On 27 February, Ben Lake MP will introduce a Bill in Parliament looking to ensure customers aren’t left without basic financial services by bank closures.


The devastating effect of banks pulling out of communities leaves thousands of people unable to complete the most simple of financial chores – like pay in a cheque or even access cash.

Rural communities have been particularly hard hit. The closure of the last bank in some villages and towns is forcing people to travel tens-of-miles to the nearest bank. Coupled with poor internet access and an inability to access online banking, countryside customers and business are being left in a “banking black-hole”.

The Bill, supported by MPs from all political parties, has a three prong approach to address the issue where banks are still in operation, where they are thinking of leaving and where they have already left.

The measures in the Bill, which will be outlined in Mr Lake’s speech in the House of Commons today, will:

  • Make it more difficult for banks to close – by changing the ‘Access to Banking Protocol’ so banks will have to consider transport time to their next nearest branch – not just distance as is currently the case – when making a decision about closing.
  • Create ‘Local Banking Hubs’ – By changing existing rules, banks will be allowed to ‘co-locate’. Meaning more than one bank could share a premises and some administrative functions. This will make it more cost-effective for multiple banks to remain open in an area.
  • Enhance financial services offered by Post Offices – Post Offices already have the ability to offer a range of banking services – from paying in cheques to withdrawing cash. But many branches lack the basic infrastructure, funding, and training to carry out these services. By investing in Post Offices, the Westminster Government could ensure the 99% of retail customers and 95% of commercial customers that have easy access to Post Offices can at least use basic banking services.Ahead of presenting the Bill in Parliament, Ben Lake MP said:

“Banks are the beating financial heart of our communities. By pulling out of high-streets across the country they are leaving customers high-and-dry. “In rural areas, people are being forced to travel tens-of-miles to the nearest bank. And with underinvestment in broadband infrastructure, online banking is not an option. These communities are being left in a banking black hole.  

“Businesses can’t make deposits, customers can’t pay bills and fundamentally, our communities are left poorer. It is older and vulnerable people, and small local business that suffer most when a bank closes. That is why I am putting forward solutions which the Westminster Government can act on right away.  

“With the three prong approach outlined in the Bill, we can make sure banks can’t simply disappear and where there is already no bank, customers can have access to the banking services they need more easily through the Post Office.

“I also recognise that banking is changing. That’s why I am suggesting a change the law to allow for ‘Local Banking Hubs’ to be created. This will make it commercially viable for banks to stay open by sharing premises and some other administrative functions.

“RBS last week announced a near billion-pound-profit. Whilst only a matter of weeks ago, they closed 20 branches in Wales and hundreds across the UK. Profit is being put before people and that needs to change. With these proposals, we can make sure that the City of London is not the only place where banks are left.”  

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