British banks are reportedly nearing a deal with the Post Office that could lead to the closure of thousands of local bank branches.
Under the agreement, the Post Office will be able to serve small business customers from leading UK banks. The Post Office, which operates over 11,500 branches across the country, currently provides deposit and withdrawal services for most of Britain’s personal banking customers.
The government said earlier this year that it was seeking an agreement between lenders and the Post Office that would “minimise the impact of branch closures”. An estimated 2,000 bank branches have closed in Britain in the last five years
The Sunday Times reported over the weekend that a final deal between the banks and the Post Office could be announced as soon as next month.
The British Bankers’ Association (BBA) has previously welcomed the proposals. In March, BBA chief executive Anthony Browne, said: “Communities will be given fair notice of any closure and clarity about the alternative places and ways to bank. This includes the Post Office, which is an ideal shared service for customers who prefer counter services.”
Meanwhile, the Move Your Money campaign, which opposes bank branch closures, has criticised the proposals, saying Post Office provision “simply cannot compensate for the loss of a real bank”.
Fionn Travers-Smith, the campaign’s manager, told City A.M. today that post offices provide “an inadequate replacement that is simply not comparable”.
A Post Office spokesperson would not comment directly on the timing of a deal, but said: “For a number of years, the Post Office has offered selected services to UK bank’s personal and business customers. We are keen to ensure that both personal and business customers of all banks can undertake basic banking services in Post Office branches. This will ensure that all communities have access to local banking transactions.”
A business department spokesperson declined to comment.