Lloyds Shuttering 136 Branches Amid Digital Banking Shift

British lender Lloyds is closing 136 branches as its customers choose digital financing services.

The closures will affect 61 Lloyds branches as well as 61 Halifax and 14 Bank of Scotland locations between May this year and March 2026, the Financial Times (FT) reported Wednesday (Jan. 29).

Workers at these branches will be offered roles at other branches or a different area of Lloyds’ business, the bank said.

“Over 20 million customers are using our apps for on-demand access to their money and customers have more choice and flexibility than ever for their day-to-day banking,” said the bank, per the FT report.

Research by PYMNTS Intelligence has shown that banks are increasingly merging digital and physical offerings, with 42% of consumers conduct their banking online, with 46.8% doing so through mobile means. Roughly two-thirds of consumers reported using an app on their phone for banking (mobile banking, 68.6%) or from their desktop with a browser (online banking, 66.6%) at least once a month.

“Banks are examining and re-examining their tech stacks to more fully tap into instant payments, digital account openings and embedded finance, among other initiatives,” PYMNTS wrote last year.

The FT report also notes that banks have been increasingly closing down brick-and-mortar locations to reduce costs. The British consumer group Which? estimates that U.K. lenders have shuttered more than 6,000 branches in the past decade.

According to the FT, Lloyds had told staff recently that Halifax, Lloyds and Bank of Scotland customers would be able to use any of its branches across the three brands, leading to speculation that it was planning to close branches.

Lloyds was already aiming to close 55 branches between January and September this year, the report added, citing the trade union Accord. The new round of closures will bring the bank’s total number of branches to 757.

Last year, the U.K.’s Financial Conduct Authority (FCA) published its “access to cash” rules, requiring banks to hold off on branch closures until they can show that communities would still have free access to alternative sources of cash.

“Three million people continue to rely on cash, even as digital payments become more popular,” Sheldon Mills, the FCA’s executive director of consumers and competition, said in a news release. “And many small businesses still need somewhere to safely deposit their takings each day. That’s why we’ve acted quickly in response to new powers given to us by Parliament to ensure reasonable access to cash withdrawal and deposits is maintained.”

At the time, the FCA noted that its data showed that — in the two years leading to June of 2023 — 1,358 bank and building society branches closed in England.