Banks warned not to close branches during pandemic

THE Financial Conduct Authority (FCA) has warned UK banks not to close branches if doing so would harm vulnerable customers during the Covid-19 lockdown.

In September 2020, it published guidance on branch and cash machine closures and was designed to protect consumers by setting expectation that firms should assess customer needs and consider the availability and provision of alternative arrangements where closures or conversions are planned.

It requires firms to treat their customers fairly and communicate with them in a fair, clear and not misleading way with the expectation that banks exercise particular care with vulnerable customers.

In January 2021, the Government and devolved authorities announced new restrictions across the UK due to Covid-19 but some banks and building societies have said that they are either going ahead with branch closures already announced, or announcing new branch closures during the current lockdown.

The FCA is concerned that these activities could have significant consequences for customers. It may be harder than usual to reach all customers under the current restrictions and engage with them on closure proposals effectively (for example, small businesses that are temporarily closed).

They advise banks to delay any closures for the time being.

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