The number of U.S. bank branches has declined sharply in the last several years, according to a report from the Daily Mail. Citing exclusive S&P Global Market Intelligence data, the UK outlet reports that 9,536 bank branches have closed since 2019. As the Daily Mail notes, the closure of so many local banks has helped to drive the transition to digital banking services.
Disadvantaged communities hardest hit?
The Mail’s report also cites concerns from the National Community Reinvestment Coalition. That organization has noted a startling trend in which roughly one-third of closures occur in disadvantaged communities. Those minority and low-income communities may suffer even more from a lack of easy access to in-person financial advice and other vital banking services.
One concern is that residents in areas without that access may be forced to travel greater distances for those services. For elderly and low-income residents without ready internet access, digital banking services may not always be a viable alternative.
Digital banking services as a substitute for traditional branches
While digital banking services are a popular option for many bank customers, they may not satisfy every customer’s needs. Many bank users still need to cash physical checks, seek financial advice, or deposit cash in their accounts. For those tasks, brick and mortar banks may still be seen as the best option.
S&P Global Market Intelligence data confirms that bank closures have accelerated in recent years. 1,417 branches closed in 2019, followed by 2,126 closures in 2020, 2,927 in 2021, and 3,066 last year. There are currently more than 78,000 bank branches across the United States, but most experts expect that number to continue to decline.
As bank branch closures continue, reliance on digital banking services is expected to increase. What that means for consumers without access to those services remains to be seen.