Bank closures are making the low interest rate environment worse - what can you ...

Budget 2021: Rishi Sunak issues warning about interest rates

Cash access came into focus recently as three announcements on the future of cash were made on the same day. On May 13, UK Finance published a commitment to long term access to cash, which was signed by a number of banks including Barclays, HSBC and Santander.

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Additionally, the Financial Conduct Authority (FCA) published a joint statement with the Payment Systems Regulator (PSR) on the importance of cash usage.

On top of this, Sheldon Mills, the Executive Director for Consumers and Competition at the FCA gave a speech on cash usage at the Which? Cash Summit.

With all this commitment, savers may be reassured that their financial futures are secure and poised for recovery.

But, unfortunately, analysis from Hargreaves Lansdown shows the future for savers may be bleak, especially when factoring in the low interest rate environment.

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READ MORE: Savings 'inertia' forces billions into NS&I premium bonds

Bank closuresBank closures may worsen the low interest rate environment (Image: GETTY/PA IMAGES )

Sarah Coles, a personal finance analyst at Hargreaves Lansdown, commented on this: "The bank branch network has been imploding for years, but the pandemic picked up the pace, and piled pressure on the industry to protect people who need face-to-face banking.

"It looks increasingly like the solution isn’t going to involve maintaining branches as we know them, but as they die away, the banks will offer new alternatives on the high street.

"The closure of bank branches is a vicious circle. The more that close, the more people move online, so there are fewer people relying on high street branches, so more of them close.

"The pandemic picked up the pace around this ever-decreasing circle, closing more branches temporarily and causing online banking to spike.

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