Branch and ATM closures or conversions; good practice and areas for improvement

Find out more about the good and poor practice we have seen when supervising firms planning branch or ATM closures or conversions.

We want to ensure that bank branch and ATM (cash machines or cashpoints) closures or conversions are made in a way that takes proper account of customers’ needs. In October 2022, we issued updated guidance outlining our expectations of how firms should conduct their closure or conversion processes.

Firms should now consider the content of our guidance when they propose:

  • the full closure of a branch or all ATMs operated by a firm at a particular location, or a mobile bank facility no longer operating  
  • a partial closure of a branch, which is defined as a reduction in branch opening hours or days or reduction in branch services, where this would have a significant impact on customers

The examples below, although not exhaustive, set out the good practice we saw prior to issuing the updated guidance and some areas where we expect to see improvements. In the examples provided, firms have engaged constructively to make improvements when their processes have fallen short of our expectations. We share this now to provide some clear examples on how firms can improve their approach and enable all firms to have the opportunity to learn from the good practice we have seen.

This piece forms part of our wider work on access to cash and banking services. We are committed to protecting access to cash, particularly for consumers with characteristics of vulnerability who rely on it.

Our expectations

Although the decision to close a bank branch or ATM or to convert a free-to-use ATM to a pay-to-use ATM is a commercial choice for firms, we expect firms to assess how planned closures (full or partial) or conversions will affect customers, particularly those in vulnerable circumstances, and to make appropriate arrangements to ensure their needs are still met. For example, this includes assessing what alternative services firms could reasonably put in place to meet their needs.

Our updated guidance outlines how a bank may ensure it is adhering to the following principles:

  • Principle 6: A firm must pay due regard to the interests of its customers and treat them fairly.
  • Principle 7: A firm must pay due regard to the information needs of its clients and communicate information to them in a way which is clear, fair and not misleading.
  • Principle 11: A firm must deal with its regulators in an open and cooperative way, and must disclose to the FCA appropriately anything relating to the firm of which that regulator would reasonably expect notice.

Our Consumer Duty (Principle 12) comes into force on 31 July 2023. Firms should refer to PRIN 2A.1.16- to PRIN 2A.1.18 which provides guidance on the relevance of guidance about Principles 6 and 7 issued before the Consumer Duty comes into force.

Examples of good practice and areas for improvement

Next steps

We will continue to supervise bank branch and ATM closures and conversions to ensure fair treatment of customers. We are also supporting the Government as it develops legislation to protect access to cash.

Find out more about our work on the helping people access cash page, including our next steps.

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