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Closure of Santander branches proof of challenger success, says fintech

Jo Howes, Commercial Director at CREALOGIX

Today’s announcement by Santander that it is closing 140 high street branches across the UK is further proof that challenger banks are taking over the market, a leading fintech has said.
The Spanish-owned bank’s branch network is to be reduced by almost a fifth, placing 1,270 jobs at risk.
The bank said the closures reflect ‘changes in how customers are choosing to carry out their banking’, pointing out that branch transactions have fallen 23% in the last three years, while digital transactions have soared 99%.
Its remaining 614 outlets will either be larger branches offering improved community facilities, or smaller branches deploying new technology to offer more convenience, it explained.
“Santander is just the latest in a series of high street banks to announce multiple closures of their branches, following the footsteps of NatWest and HSBC in recent years,” commented Jo Howes, Commercial Director at CREALOGIX. “Traditional banks are facing increasing competition from the more agile and consumer-focussed digital-only competitors, which offer the features and personalisation that consumers desire. To compete and stay relevant, every bank and building society needs to start innovating and offering differentiated features. This decision by Santander is the first step in its transition to a digital offering, and to satisfying customer demand.”
Howes said that for now, the challenge for big banks is how to maintain reasonable feature parity with the challengers, as the feature and design gap between challengers and less technologically-agile banks, is widening: “Established banks have the foundations of trust and market share to keep them ahead of the game, but they must bring the competitive fight back to the challengers by focusing on placing their customers at the heart of their business,” she concluded.

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