Banks and building societies will have to do more to look at the impacts of reductions to their services, such as cutting branch opening times, under new proposals from the City regulator.
The Financial Conduct Authority said some banks and building societies are not doing enough to understand the impact of the changes they make or to keep their customers informed.
Briefing other groups such as local charities and councils to understand the wider impact of changes to services is also included in the proposals.
The regulator’s financial lives survey in 2020 found that about a quarter of adults with a day-to-day account regularly used a branch. One in six had a branch they previously used regularly close down in the previous 12 months.
The regulator wants to extend its guidance so that it applies where firms partially close a branch in the same way as it does to full closures. It is proposing to define a “partial closure” as a long-term reduction in branch opening hours or days or a reduction in services, such as the removal of a counter, where this would have a significant impact on customers.
This would also capture extended periods of closure lasting six months or longer, which might otherwise be seen as “temporary”, such as closures due to long-term building works. The FCA is inviting responses by July 26.
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Bank closures to be reviewed by city regulator