HSBC announces job cuts
HSBC is shutting down a quarter of its branches in the UK as more customers move online Photo: AFP / ISAAC LAWRENCE

HSBC Holdings, a renowned banking and financial services institution in the UK, has announced it will shut down 114 branches in the United Kingdom from April as it faces pressure from its investors to cut costs.

Bank branches getting less patronage

The 157-year-old lender has attributed its action to the shift in customer preference for online banking. The bank branches have experienced a dramatic fall in patronage since the Covid-19 pandemic. The number of HSBC UK branches has shrunk from 1,200 in 2012 to less than 500 ten years later.

Customers now operating digitally, UK banks closing branches

According to HSBC, the use of its mobile app has more than doubled since 2017, with various transactions completed online. Additionally, the number of customers visiting the HSBC UK branches has fallen by 65 percent in five years.

More than 97 percent of HSBC transactions, credit card applications, and personal loan applications now take place digitally, with some branches attending to less than 250 customers a week.

HSBC is not the only bank closing its branches due to the shift to online banking. According to the consumer group Which?, High Street banks and building societies have shut down more than 5,200 branches since 2015. RBS and Ulster Bank's parent company, Lloyds Banking Group, has closed more than 1,200. Lloyds Banking Group, which owns Halifax and Bank of Scotland, shut down more than 70 more in 2023. British lending giant, Barclays, has closed more than 960 branches in the United Kingdom.

'Footfall in many branches is at an all-time low'

According to Jackie Uhi, HSBC managing director of UK distribution, people are switching from the way they used to bank, and "footfall in many branches is at an all-time low, with no signs of returning."

Uhi stated that the bank closure project- which shows effects on one-quarter of its nationwide network- follows ECA guidelines. She continued, saying the bank has made provisions for the "after wave of closure," which includes free tablet devices to customers of selected UK branches that do not have devices to bank online, with proper education on how to move to digital banking.

HSBC to begin closure with 11 branches in Bristol, Cromer, St. Ives, others

According to the bank, 11 branches would be shut in April, with others following through until August. The branches closing in April include Abergavenny, Alton, Bexhill on Sea, Blandford Forum, Bristol Downend, Cromer, Leominster, Market Bosworth, Shaftesbury, St Austell, and St. Ives.

'We may see 100 employees leave the bank'

The bank, which has over 15 million UK customers, also has plans to redeploy all affected customers. However, it added, "we may see 100 employees leave the bank" due to the changes.

HSBC UK has assured that it will put a lot of money into "updating and improving" its 327 UK branches that remain.