Money access crisis: More than half of Scotland's bank branches are axed in six years

It is also expected to unveil a venture involving Britain's biggest high street banks agreeing to fund the joint provision of cash services in communities which face being left without them. It is expected to cost the major banks millions of pounds annually to run.

A new analysis produced exclusively for the Herald on Sunday by the consumer organisation Which? has revealed that 54% (554) of the 1019 bank branches that existed in Scotland in 2015 will have shut by early next year.

With Edinburgh-based TSB announcing it was axing 70 bank branches next year, including nine in Scotland, putting 150 jobs in a new wave of cuts, it will leave the nation with just 465 bank branches open next year.

It has put new weight behind calls for a paused to bank branch closures until adequate alternative measures are actually in place.

Earlier this year TSB forged ahead with closures of 73 bank branches and a cut of around 300 jobs despite appeals to save branches in remote and most deprived areas of Scotland.

While there has been continued resistance to closing the 'last bank in town' the move meant shutting down the last remaining bank in the eastern coastal corner of Fife, East Neuk, home to picturesque fishing towns and described as "one of Scotland's hidden gems".

Despite, protests from the community, the closure of TSB’s Anstruther branch which overlooks the town's beach marked the end of the last bank in the area after the closure of the Royal Bank of Scotland in 2017.

While the branch shut, TSB bowed to public pressure in April and agreed to launch a mobile advisory service based in Anstruther town hall.

But it was not enough for the hundreds of local people who signed a petition opposing both the branch closures in Cupar and Anstruther.

The rate of bank branch closures in Scotland has shot up this year.

Over the first half of 2021 they were closing at a rate of 14 a month on average - compared to six a month over the five years to 2020.

The pilot schemes fronted by Community Access to Cash Pilots Board chairman Natalie Ceeney offered access to basic banking and cash withdrawals and deposits through a counter operated by the Post Office, which will support the customers of all major retail banks.

The pilots report is expected to say that the hubs have made such a difference to the local communities Cambuslang and Rochford that the banks have agreed to keep them running, on an ongoing pilot basis, until at least the spring of 2023.

It is expected to say that the community leaders in Cambuslang, credit the hub for supporting economic regeneration and for keeping retailers viable.

Which is urging banks to prove they can take effective action to stop people losing access to cash and valued bank services without adequate alternatives being ready to put in place - or pause their branch closure plans until the government legislates to protect cash.

Gareth Shaw, head of Which Money said: "The story of dwindling access to cash is a familiar one for the millions of people in this country that rely on it. Successive recent announcements by major banks and building societies that they are closing branches are hammer blows to local communities.

"Consumers are right to be concerned.

"Bank branches take with them not just the ability to access cash, which some of the most vulnerable in society continue to depend on to pay for everyday essentials, but also in-branch banking support that so many people tell Which they couldn’t do without."

Figures reveal that Scotland is the region of the UK that will have suffered worst from the cuts suffering the highest proportion of closures.

As of last year, the north west of England and Wales was seeing 44% of their branches go, while the south west of England was seeing 43% axed. Areas of the UK that were least affected were London and Northern Ireland where there was a 30% cut, while the Channel Islands and the Isle of Man remain unaffected.

Recent research from the Financial Conduct Authority found that, during the pandemic, 15% of UK adults have struggled to cope without access to bank branches and ATMs, while 16% suffered as more businesses stopped or encouraged customers to use contactless or digital payments But Which said that measures had to be put in place to support the five million that the FCA said remain dependent on cash.

"Of course, most people can now bank digitally, and the days of multiple banks competing for customers on the same high street are largely gone," said Mr Shaw. "More people than ever before are paying digitally, yet those less comfortable with this will require support as their banking activities change. Which will work with the industry, regulators and other consumer groups to help them to manage that transition.

"Yet we mustn’t forget the consumers who still want access to cash. From the self-employed, to those living in rural areas; those living on tighter budgets, to people living with disabilities.

"The current rapid rate of branch closures suggests that some banks are rushing to shut branches before solutions to protecting cash can take effect, and flies in the face of work being done by the banking industry to protect access to cash."

A 'cashback without purchase' scheme is also being rolled out to some 200 shops across Scotland by the end of the year in a bid to retain the public's right to access hard cash.

The solution means consumers can make a cash withdrawal of up to £50 and check their balance without needing to make a purchase.

But Which is seriously concerned that any proposals made by the group could be undermined by the commercial decisions to close branches before solutions to protect cash can take effect.

The consumer organisation has written this week to each bank associated with pilots' scheme to ask that they immediately pause bank branch closure plans until communities at risk of being cut off from cash and vital banking services can have confidence that there will be adequate replacements.

Mr Shaw added: "Assessments should be made of the threatened community’s cash and banking needs - assessments that must be independent and, crucially, made public to ensure full transparency.

"If an area has branches earmarked for closure, then access to the most appropriate alternative type of provision should be seamless, whether it’s a shared bank hub or a Post Office with the right facilities, to ensure customers - particularly the elderly and more vulnerable - aren’t left in the lurch.

"And if banks cannot demonstrate that this is happening, the pause on bank branch closures should be extended until long-overdue legislation to protect cash is in place."

Data provided by LINK, the UK's main cash machine network, revealed that the number of ATMs dropped from 5,866 in November, 2019, to 5,239 in September last year. There were 4022 free-to-use cash machines across Scotland while 1,217 charge - meaning that in one in four of the nation's ATMs you have to pay to get your money out.

In January, research showed that over 2m Scots have been refused payment with notes and coins during the pandemic, threatening the viability of the cash network.

But Which said that the a pause on closures needs to be coupled with 'long-overdue' legislation by government to safeguard people's access to cash.

"Given the rapid rate of bank branch closures, that can’t happen quickly enough. Without it, laudable but voluntary and easily reversible schemes like banking hubs and cashback without purchase won’t be sufficient to plug gaps in the UK’s fragile cash system," said Mr Shaw.

"Above all, a temporary pause on bank branch closures would prevent the creation of any new cash deserts. As many consumers in Scotland can attest, there are already far too many of those."