The recent announcement of branch closures is the latest stage of a trend that goes back to at least the early 1990s. This coincides with the LINK network's proposals, also controversial (see Lord McFaul's comment), to reduce both the interchange fee that banks pay per ATM transaction, and the number of "free" ATMs where these are tightly clustered. Critics claim the first of these in particular will lead to the closure of low volume ATMs in towns and villages. There is irony here, as the spread of ATMs was one of the original factors in branch closures. 

Meanwhile, also in train are the FCA's market study of retail banking (including a review of the "free" banking model) and the post crisis Ringfencing of the five largest high street banks, with the Open Banking "revolution" due to arrive in January.

I always worry about multiple, overlapping sets of reforms in a regulatory context. Any measurement of their impact - daunting at the best of times - becomes all but impossible, and the scope for unintended consequences tends to multiply exponentially. 

Against this density of change, it's not hard to imagine a future scenario in which even quite large towns have become essentially "unbanked" in a bricks and mortar sense. Meanwhile, "free" banking disappears, the decline of cash accelerates, and the number of payment services providers proliferates. Each of these might be good and/or inevitable in themselves, but that's not the main concern here, though it's worth coming back to the question of "unbanked" towns at the end. 

Instead, my worry is the aggregate consequences of the changes. Here are three unintended possibilities, each accentuating existing trends...

1. Young people distinguish less between banks and other credit providers - it's all about the App - and start to save less.

2. Older people, especially in small towns, become more housebound - less need/excuse to go out - with a resulting rise in their financial vulnerability.

3. SMEs find it harder to borrow, as banks' understanding of their business models declines in proportion to their increasing distance - social as well as physical.

There are good reasons for reform and change, and I've written before about the dangers of it happening too slowly. But as the (potential) financial vulnerability of consumers is becoming increasingly recognised, and when the extent of overlapping change is so great, it must make sense to pay greater attention to the potential combined fallout than currently seems to be the case. 

Returning briefly to the retreat of bank branches from our smaller towns, there are deep and complex issues in play here involving our general social cohesion and economic growth. Firms and regulators can't solve these by themselves. But both have good reason to care about not accentuating vulnerabilities, still more about not creating new ones. This ought to give rise to more than a pause for thought - it's no longer the 1990s.