Digital banking is reshaping how we handle money in the UK as we see high-street bank branches vanish across the country. SumUp found that 18% of people in the UK have gone fully digital and 23% love the lower fees and convenience. However, adoption is not as fast and smooth as you might first think, with 33% of respondents still clinging to their local branches. But with closures pushing banks further away, that hesitant group may soon have little choice but to switch.

We will examine the growing trend of digital banking, its advantages and disadvantages compared to traditional banking, and how UK banking is being affected by bank closures.

UK Barclays Bank Branch Closures 2025: Will We See More Banks Disappear?

As more people choose Digital banking, banks like Barclays are rethinking their approach to banking. Barclays has said it will not close any more branches in 2025 or 2026. CEO CS Venkatakrishnan told shareholders, “We don’t have any plans to announce further bank branch closures in 2025 or 2026”. But this only comes after a huge wave of closures in the past decade.

In the last ten years, over 6,300 UK bank branches have shut down, and Barclays alone closed 1,236 of them. Other big banks, like HSBC and Nationwide, have also promised to pause closures for this year. Still, rising costs and more people banking online are slowly emptying high street bank branches, causing even those who are slow to adopt technology to jump on the bandwagon with digital, because their closest branch is now too far away.

The Rise of Digital Banking

Digital banking has taken off as more people use smartphones and apps to manage their money. In 2023, 60% of UK adults used mobile banking, up from 53% the year before. Open-banking rules and better apps now let consumers link all their accounts in one place, making it easier to see and manage their money.

Challenger banks like Revolut, Monzo and Starling have led the charge, offering instant spending alerts and fee-free overseas spending. These appealing new features are now also spreading to big banks, but they can be harder for them to roll out across their larger consumer base and internal infrastructure, leaving them behind the new digital alternatives.

Popular Alternative Banking Options in the UK

Switching to digital banking means you get new ways to manage your money. Here are three leading challengers that you might want to consider if you are thinking about making a switch.

Monzo

  • Budgeting tools: Pots let you set aside money for bills or fun, with spending summaries at month’s end.
  • Regulatory protection: Your pounds are covered up to £85,000 under the Financial Services Compensation Scheme.
  • Extras: Instant spending alerts and fee-free card use abroad.

Starling

  • Budgeting tools: Spaces let you create savings goals and put money aside automatically.
  • Regulatory protection: Eligible deposits are protected up to £85,000.
  • Extras: Overdrafts on demand, fee-free overseas ATM withdrawals up to £300 per month.

Revolut

  • Budgeting tools: Vaults let you round up card payments into savings and set recurring transfers.
  • Regulatory protection: Only partially regulated in the UK and bank deposits are currently safeguarded via a third-party scheme.
  • Extras: Real-time currency exchange, crypto trading and in-app stock investing.

How to Choose the Right Alternative Banking Options

Picking the best option comes down to your individual spending habits and needs. This is a quick list of things to consider:

  • ATM access: Are there fee-free cash machines nearby?
  • Customer support: Do they offer live chat, phone lines and can they help 24/7?
  • International payments: How high are the charges for using your card when you travel or send money abroad?

Conclusion

Bank branch closures in the UK don't seem to be stopping, but you don’t have to lose easy access to your money. Embracing digital banking gives you 24/7 control and the freedom to manage your cash from anywhere.