Nearly a million customers across the UK are at risk of having no major bank branch in their local area within a matter of months, according to a new study on the state of banking in the UK.

The bank closures study, by AI and analytics leader SAS, compared the number of bank branches open in 2020 across all local constituencies in the UK to the number closed over the last three years, to understand the annual bank closure rate.

SAS looked at seven of the largest banks in the UK, to discover that those in Ross, Skye and Lochaber in Scotland, Copeland, Central Devon and Gainsborough are at risk of having zero in-person branches within the next few months, assuming the current rate of closures continue.

The study found that if banking hubs aren’t rolled out at a faster rate, up to 80 constituencies could be at risk of losing all their remaining branches in the next year, having each lost more than 80% of their banks in the last three years.

Online banking provides access to banking services for individuals who may be geographically distant from physical branches, and for people who want 24/7 accessibility to their finances. However, for customers who prefer to discuss complex matters in person, or who simply prefer face-to-face interactions, brick-and-mortar banks still have an important role.

The average constituency across the UK saw 51% of its banks close in the last three years, with a branch loss rate of 17.3%.

The 10 areas most likely to be ‘bankless’ in 2024:

1 - Ross, Skye and Lochaber, Scotland (18,819 people per branch)

2 - Argyll and Bute, Scotland (8,626 people per branch)

3 - Dumfriesshire, Clydesdale and Tweeddale, Scotland (800 people per branch)

4 - Caithness, Sutherland and Easter Ross, Scotland (188 people per branch)

5 - Copeland, England (39,000 people per branch)

6 - South Down, England (123,121 people per branch)

7 - North Ayrshire and Arran, Scotland (20,320 people per branch)

8 - Central Devon, England (47,612 people per branch)

9 - Tewkesbury, England (112,255 people per branch)

10 - Gainsborough, England (98,796 people per branch)

Louise Potts, Head of Banking, Customer Advisory at SAS UK, said:

“Online banking has revolutionised personal finance, making it easier for customers to carry out day-to-day transactions whatever their location. Analytics and AI has also personalised the online experience, improved responsiveness and helped with fraud prevention, but it’s not always a viable option for everyone. In-person banking services provide crucial services if you’re struggling to access the internet or find a solution online.

“Banking hubs have become a new alternative for those who don’t have access to a traditional branch. Owned by Cash Access UK and run by the Post Office, banking hubs provide access to a number of High Street banks, giving people the option to deposit, transfer and withdraw money from most major banks - all under one roof.

“Ultimately, everyone needs access to banking. Our research highlights the areas that may need support, whether it be technological advancements to improve internet access, or consideration for the opening of a new banking hub.”