An MP has introduced a private members bill to ensure rural communities aren't left without financial services when bank branches close.

Ceredigion MP Ben Lake said he wanted to make it more difficult for banks to close, by changing the ‘Access to Banking Protocol’.

This would ensure that banks would have to consider transport time to their next nearest branch when making a decision about closing, he said.

Many rural communities have been hard hit by banking closures – especially those where there are no alternative banking facilities.

    Changing rules

Mr Lake said changing existing rules to create “local banking hubs” would encourage banks to co-locate – so more than one bank could share a premises and some administrative functions.

“This will make it more cost-effective for multiple banks to remain open in an area,” he said.

Mr Lake said he also wanted to enhance financial services offered by Post Offices.

“Many Post Offices lack the basic infrastructure, funding, and training to carry out basic banking services,” he explained.

“By investing in Post Offices, the Westminster government could ensure that retail and commercial customers are able to access financial services at their local PO branch.”

    Banking services

Post Offices already have the ability to offer a range of banking services – from paying in cheques to withdrawing cash.

But Mr Lake said many branches lacked the basic infrastructure, funding, and training to carry out these services more effectively.,

It was important that retail and commercial customers that had easy access to Post Offices were at least able to use basic banking services.

Mr Lake said: “Banks are the beating financial heart of our communities. By pulling out of high-streets across the country they are leaving customers high-and-dry.

“In rural areas, people are being forced to travel tens-of-miles to the nearest bank.

    Left in 'black hole'

“And with underinvestment in broadband infrastructure, online banking is not an option. These communities are being left in a banking black hole.”

Businesses couldn't make deposits, customers couldn't pay bills and fundamentally, our communities are left poorer, said Plaid Cymru MP Mr Lake.

“It is older and vulnerable people, and small local business that suffer most when a bank closes. That is why I am putting forward solutions.”

Mr Lake said he recognised that banking was changing, which was why he was pushing for a change the law that would allow for ‘Local Banking Hubs’ to be created.

“This will cut costs and make it commercially viable for banks to stay open by sharing premises and some other administrative functions,” he said.