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Banking: Balancing digital and branch

When the financial crisis hit and retail banks – desperate to cut costs – closed less profitable branches, they did so chiefly in rural towns, or low- to moderate-income (LMI) communities.


In the UK, a report published in October by the Office for National Statistics shows that nearly 6,000 local bank branches have shut in the UK since 2010 – a drop of a third. In the US, 1,200 branches were closed in 2017 alone.

Leaving individuals unbanked or underbanked, banks have defended themselves by pointing to improved online and mobile banking.

However, as research is now showing, people need some balance of digital offering and high-touch service that neither banks nor pure fintech players have managed to fully figure out.

In LMI communities where access to wifi or devices is limited, minimal data packages deter the use of mobile banking. Some individuals, particularly the elderly, are not digital savvy, and among them the reduction in high-touch banking has been felt most starkly.


There are many online banks offering free savings accounts with solid interest rates, but without a human touch to explain and help individuals to set up an account and support them in accessing it, they end up excluding a segment of the population that would benefit from their services.