A new study has investigated the impact of bank branch closures on the UK's small business community.
The majority of UK small businesses (88%) are worried about the loss of local bank branches, according to a survey of 1,000 business leaders and senior decision-makers at UK SMEs conducted by BusinessComparison.
The business banking poll asked SME leaders about how often they use their local bank and what worries them the most about bank closures. Three-quarters (74%) agree that there are fewer bank branches near their business than there were ten years ago.
Key findings include:
- 88% of business leaders are worried about bank closures in their area;
- 50% are concerned the impact on businesses that take cash payments;
- 34% are worried about the impact on customers.
The most common reasons to visit a bank are to deposit takings in cash and to collect change. A quarter (24%) of business leaders said they take cash payments "often" and 23% said they take cash "sometimes". While 47% of businesses said they never run out of change to give to customers, 13% say they do several times a week.
As a result, a key issue is the time it takes to visit a local bank branch:
- 51% of business leaders say it takes them or a staff member 11 to 30 minutes to visit the local bank;
- For 21%, it takes 31 to 45 minutes;
- Only 15% of those polled can get to a bank branch in less than ten minutes.
"It was heartening to see how much of a sense of business community emerged from the survey results. For 88% of business leaders, the main concern when it came to bank closures was the impact on the local area, including other businesses." Philip Brennan, founder and md, BusinessComparison.
Online business banking
The research reveals that 44% of business leaders "always" use digital banking services to complete routine tasks, and 34% bank online "often". However, the findings suggest that many businesses are still using cash.
London is the region where business owners are most likely to say they often take cash payments; at 40%, this is much higher than the national average of 24%. This region is also the most likely to have a member of staff visit the bank every day, at 62%. Businesses in the South East are most likely to only take card payments, at 35% (compared to the national average of 21%).
Written by Rachel Miller.
