In a restructuring move, Santander UK, the United Kingdom based division of the Spain’s Banco Santander (NYSE: SAN), announced that it will close 95 of its 444 U.K. branches, representing roughly one-fifth of its physical network.
The bank has posted a list of the impacted branches along with the date the locations are expected to be shuttered.
This decision, set to take effect in June 2025, reflects a general trend in the banking industry as customers increasingly prefer all-digital / online and mobile banking over traditional in-person services.
The closures will put approximately 750 jobs at risk, raising concerns about employment and access to financial services across the UK. However, this move is broadly in line or consistent with global trends as financial institutions look to cut costs in an increasingly competitive business environment.
The bank’s decision also comes as no surprise given the rapid digitization of financial services and the rise of Fintech.
Santander reported a 63% surge in digital transactions since 2019, alongside a 61% decline in branch-based financial transactions over the same period.
This shift in customer behavior has prompted the lender to reevaluate its physical footprint, aligning its operations with modern banking preferences.
“The bank has seen a rapid movement of customers choosing to do their banking digitally,” Santander UK stated, emphasizing its commitment to adapting to these changes while maintaining service quality.
Of the remaining 349 branches, Santander plans to adapt its network to a hybrid model.
Approximately 290 will continue as full-service locations, offering a comprehensive range of in-person banking options.
Meanwhile, 36 branches will operate with reduced hours, and 18 will transition to “counter-free” formats, focusing on advisory services rather than traditional teller transactions.
This reconfiguration aims to strike a balance between digital convenience and face-to-face support, a strategy the bank has been testing in select locations since 2024.
The closures are part of a broader cost-cutting and modernization effort as Santander UK navigates a competitive domestic market and evolving regulatory pressures.
While the bank remains a key player in the U.K., with 14 million active customers and around 18,000 employees, its physical presence has steadily contracted. Santander shares that about half of its customers use its digital banking app.
This latest round follows a 2021 review that saw 111 branches shuttered, underscoring a long-term shift away from brick-and-mortar banking.
Despite the reduction, Santander assures that 93% of the U.K. population will remain within 10 miles of a branch post-restructuring.
For affected employees, the bank has pledged support, including consultations with unions and efforts to reassign staff to other roles where possible.
However, with only about 100 of the 750 impacted positions expected to be redeployed, the closures signal a significant workforce adjustment.
Santander UK has framed the move as a necessary evolution, stating,
“Closing a branch is always a very difficult decision, and we spend a great deal of time assessing how to minimize the impact on our customers.”
The announcement arrives amid broader industry debates about the role of physical branches in an increasingly digital world. In the coming years, it might become completely unnecessary to actually visit a physical branch, given the rapid advancement in digital technologies.
While Santander invests in its online platforms, some would argue that such closures risk alienating customers who rely on in-person services, particularly in rural areas.
As the UK’s financial landscape continues to evolve, Santander’s pivot highlights both the opportunities and challenges of balancing technological progress with traditional banking accessibility. However, some of the older consumers and less tech-savvy individuals can be negatively impacted by these closures so it is a good idea to figure out how to serve this customer segment in a more practical and effective manner.