HSBC to close a quarter of British branches as fewer customers use physical locations and go digital

London-based lender to close 114 branches in its second-biggest market
Footfall has fallen by half in 74 per cent of the branches set to close, HSBC says

Banking & finance

Chad Brayin London

Published: 10:30pm, 30 Nov 2022

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HSBC plans to close about a quarter of its branches in Britain, its second-biggest market, as fewer of its customers use physical locations to carry out their daily banking business, the lender said on Wednesday.

The London-based lender said it plans to close 114 branches beginning in April 2023, saying footfall had fallen by at least half in 74 per cent of the branches set to close. Overall use of its British branch network had fallen by 65 per cent over the past five years, HSBC said.

The decline in branch use further accelerated during the Covid-19 pandemic, with some locations now serving fewer than 250 customers a week, the bank said.

“People are changing the way they bank and footfall in many branches is at an all-time low, with no signs of it returning,” Jackie Uhi, HSBC’s managing director of UK distribution, said in a statement. “Banking remotely is becoming the norm for the vast majority of us. Not only can we do it anywhere at any time of day or night, many more things can be done at the customers’ convenience and don’t rely on a branch visit.”

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The bank, the biggest of Hong Kong’s three currency-issuing lenders, said that more than nine in 10 transactions are completed digitally in Britain and the use of its mobile application has nearly tripled since 2017.

Ninety-nine per cent of its personal loans and 98 per cent of its credit card are applied for digitally in Britain, the lender said.

Following the closure, HSBC will have 327 branches in Britain.

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“The decision to close a branch is never easy or taken lightly, especially if we are the last branch in an area, so we’ve invested heavily in our ‘post closure’ strategy, including providing free tablet devices to selected branch customers who do not already have a device to bank digitally, alongside one-to-one coaching to help them migrate to digital banking,” Uhi said.

Banks have been struggling in Britain with how to balance decreasing traffic in prime real estate locations in recent years with the need for local banking services as customers conduct an ever larger number of their transactions online.

A pedestrian walks past a HSBC branch on Pedder Street in Central. Photo: SCMP/Yik Yeung -man

For example, HSBC said it has given away 1,500 Samsung tablets to selected customers who cannot afford or have no access to equipment to conduct digital banking and provide digital banking training to more than 10,000 customers in communities where branches have closed since last year.

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More than 5,200 branches have closed across Britain since the beginning of 2015, according to Which?, a consumer advocacy website run by the Consumers Association. HSBC has closed more than 600 branches in that period, according to Which?.

Complaints about individual location closures have become a staple of banks’ annual general meetings in Britain.

UK banks, alongside the Post Office and the Link cashpoint network agreed last year to work together to ensure local communities have access to cash, including free ATMs, enhanced services at select Post Office locations, shared banking hubs in 10 communities and the ability to receive cash back without making a purchase.