The loss of bank branches in rural areas is depriving elderly and vulnerable people of vital services and robbing high streets of a valuable asset, according to Brecon and Radnorshire MP Fay Jones.

She was one of several Welsh MPs who complained today that the slow and steady decline of high street bank services was bad for shoppers and businesses.

"It is wrong for banks to withdraw when there are no options left," Jones said. "We do need physical banking services. We cannot just push them down the line or rely on a certain urban area."

The number of bank branches in Wales has nearly halved in the past decade, according to research by consumer advice organisation Which. Some 370 branches remained in Wales in the year to March 2020, down from 715 in 2020.

Branch closures have affected all areas of Wales, but Jones and Aberconwy MP Robin Millar said it is more rural areas that are hardest-hit.

"The experience of the residents and small businesses of Llanrwst is that first they saw banking and counter services withdrawn from the town and going down the coast to Llandudno, and they were told that they could travel to Llandudno," Millar said. "Now, they hear that the counter services in Llandudno are closing, at some banks, and moving further along the coast."

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Fewer public transport options means it is difficult for older residents to keep up with the domino effect of bank closures, the Aberconwy MP suggested.

Jones said there was "no doubt" the pandemic had "forced businesses to adapt and accelerated a wider move towards digital payments," but while those advances were welcomed, the Tory MP said concerns remained for those people who were falling through the gaps when it comes to the availability of cash and the importance of banking infrastructure in rural areas.

Older and vulnerable people are more likely to rely on cash services, while a move to online banking at home would affect lower-income households without internet access.

Pontypridd MP Alex Davies-Jones criticised banking bosses, saying: "In my constituency of Pontypridd, loyal customers whose life savings have been invested in banks are being abandoned by these corporations, which claim to serve the communities that we represent."

She went on to suggest it was "completely wrong for banks to bale out of local communities such as ours and others across Wales, when just a few years ago they had to be bailed out by the public purse themselves".

A number of schemes have been put forward to tackle the bank-branch drought in Wales. In Hay-on-Wye, which lost its last bank in 2018, the town is one of eight taking part in a Community Access to Cash Pilot scheme that involves bringing additional banking services to the town's Post Office as well as trialling a cashback-without-purchase scheme with some retailers.

And across Wales support is growing for the Banc Cambria community banking initiative that would restore in-person branches in some of the communities most affected by the departure of the big names. The Welsh Government has backed the project and there are plans to open 30 branches in the next decade.

But addressing the root cause of the problem is trickier. As UK treasury minister John Glen told MPs today, "although closures can be upsetting, they are commercial matters and the government cannot intervene".

But Glen said it was "crucial" the impact of bank closures were mitigated "where possible" so that people could still access cash and basic services.

He said the UK government was "committed to legislating to protect access to cash for those who need it while ensuring that the UK’s cash infrastructure is sustainable".

The Post Office will play a central part in this changing landscape, he said, and is able to provide withdrawal and depositing services for the vast majority of people and businesses, and well as being required to ensure 95 per cent of the rural population was within three miles of an outlet.

But, as Jones said, the loss of banks has a knock-on effect on the appeal of high streets and town centres.

"Nobody just pops to the bank as a one-off transaction: they pop into the post office, go into the butcher or go for a coffee," she said. "Banks are important parts of a thriving high street."

She added: "Our high streets are the lifeblood of the rural economy, and it is incredibly important that as we move towards a purely digital platform, we remember the need for face-to-face contact.

"If the pandemic has demonstrated anything over the past 18 months, it is that we all need and cherish human interaction, and it is incredibly important that we remember the impact that closures like these can have on mental health."

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