TSB branch closures to leave town bankless - sparking fears local businesses will end up refusing to accept cash

TSB’s branch on Cheap Street in Frome town centre will shut its doors for good on Thursday, September 19.

A TSB spokesperson cited increased levels of online banking as the reason for the closure.

Only three per cent of personal customers utilise the branch, alongside seven per cent of business customers, the bank said.

Samantha Evans, co-founder of Prosper Frome, a community finance hub initiative, told GB News she thinks the closure will exclude the elderly, vulnerable and disabled people who prefer to manage their finances in cash.

She said: “These groups find it challenging to adapt to digital banking solutions and often rely on face-to-face services.

“Local businesses are also impacted; with reduced access to cash services, many have transitioned to card-only operations.

“This not only increases their operational costs due to transaction fees but also excludes customers who prefer or need to pay in cash."

Although Frome still has a Nationwide Building Society branch, it functions as a building society and currently does not offer business banking accounts. Evans explained this limits options for local businesses needing these specific services.

The closure of Frome’s NatWest, Barclays and HSBC branches in 2023 meant businesses and residents in the town increasingly lacked access to in-person banking services, putting pressure on the Post Office as it became a banking alternative.

As the last bank in town is closing in September, Prosper is campaigning for alternatives for people who want to bank within their town.

Evans continued: “Banks often suggest that customers can shift their banking needs to local Post Office branches.

“Yet, this recommendation typically overlooks the practical capacity of these facilities to handle increased demand. In Frome, this oversight has been particularly evident.

“Many residents and business owners now face the inconvenience of traveling to nearby cities like Bath or Trowbridge to access banking services.

“This not only affects their time management but also shifts shopping and economic activity away from Frome, impacting our local market."

Anna Sabine, Liberal Democrat candidate for Frome and East Somerset, said: “This is an incredibly short-sighted decision by TSB and potentially worrying news for businesses in Frome, many of whom still rely on local banks.

“I know from my conversations with local residents how worried they are about the future of our high streets. It is clear that the Conservatives have no plan to support our high streets to thrive.”

Prosper Frome was set up last year to explore the creation of a financial hub, however the suggestion was turned down three times by LINK, the organisation with responsibility for reviewing the impact on communities of changes to banking provision. At the time, the closure of TSB in Frome had not been announced.

They were told the town didn’t qualify for an official hub, because it had adequate ATM provision and some remaining banks.

Evans said: “This has been disheartening, but we remain committed to exploring other avenues to bring essential banking services back to our community.”

Following the news about the TSB bank closure, LINK has revealed plans to introduce a new cash deposit system in the area. The Led by Cash Access UK initiative will collaborate with the local Post Office to improve existing services in the community.

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Evans said: “Prosper Frome and Frome Town Council will keep a close watch on these developments and continue to advocate for solutions that address the needs of all residents in Frome to ensure our community possesses the necessary tools to prosper in a changing economic environment."

The latest round of branch closures will start in September, and continue through to May next year. TSB will have 175 branches across the UK after the latest round of closures. Ten branches have already been closed over the last year.

TSB said: "We remain committed to face-to-face services through a branch network that covers the whole country, and over 90 per cent of our customers are within a 20-minute drive to their closest branch, or the location of a Money Confidence Expert.

"To make sure our branch services reflect the current and future needs of our customers, we want to keep open the branches that are used the most. But sometimes this means that we have to close some branches or reduce our opening hours."

LINK explained that rules mean people can't recommend a hub where there are existing bank branches. In Frome's case, it has a Nationwide. It gets a deposit service because Nationwide only does retail banking i.e. not small businesses.

A LINK spokesperson said: “As part of its role to protect access to cash, LINK assessed Frome following the announcement of a recent bank branch closure.

"While we are unable to recommend a hub where there are existing bank or building society branches, we are pleased to confirm a new deposit solution will be delivered by Cash Access UK. This will help small businesses with basic banking services such as access and banking cash services."