Residents of rural communities could be forced to travel miles to their nearest bank after the biggest lenders refused to commit to never shut the ‘ last bank in town ’ . After months of negotiation , the Government failed to secure the crucial agreement to protect customers , as bank bosses justify branch closures by stressing the soaring popularity of online banking . The High street banks have agreed to new industry-wide rules setting out a series of steps they must take before closing branches . Blame it on the internet : As they refuse to commit to never closing 'the last bank in town ' , bosses justify branch closures by stressing the soaring popularity of online banking . But critics say they do not go far enough and will allow lenders to shut hundreds of branches across the country – even when there is no other bank in the community . Under the new regime banks will have to consult with local communities before any branch closure and ensure there are alternatives for customers such as free cash machines , ‘ mobile banking vans ’ , and a local Post Office where they can sort out their finances . Existing rules stipulate that they have to go through this process only if they are closing the last branch in a town or village . Banks also have to give 12 weeks ’ notice before they shut a branch . Business secretary Vince Cable described the new ‘ protocol ’ as a ‘ major step forward ’ in ensuring those who do not bank online are ‘ not left behind ’ . But last night Labour described the rules as another ‘ nail in the coffin for the High street ’ , as all the major lenders have now ditched a previous commitment always to keep open the ‘ last bank in town ’ . Vince Cable described the new ‘ protocol ’ as a ‘ major step forward ’ in ensuring those who do not bank online are ‘ not left behind ’ Lloyds became the last to do so in October , as it announced a three year plan to shut 200 branches and open 50 . Efforts by Mr Cable to force banks to reinstate this commitment have been rejected and experts have warned that 978 branches around the country are now at risk . In total more than 500 branches are expected to be shut during the course of the year , with 210 closures announced so far . Of these 124 are the last branch in the community . For example , some 8,000 residents of Keynworth in Nottinghamshire have been left without a bank after the closure of their local NatWest branch earlier this year . and St Agnes in Cornwall has also lost its only branch after Barclays put down the shutters for the final time . There are now just over 9000 bank branches across the country , half the number of 25 years ago . Derek French from the Campaign for Community Banking said efforts by the coalition to beef up protection for consumers have failed . He said : . ‘ The government is trying to gloss over the fact that in reality it has achieved nothing and will not prevent hundreds of branches from disappearing from Britain ’ s high streets . This is hugely damaging for local communities . The hardest hit will be small businesses , the elderly and the vulnerable – who rely heavily on their local bank ’ . Chris Leslie , shadow chief secretary to the Treasury said : ‘ This is a massive embarrassment for Vince Cable . Local communities sometimes rely on the basic services of a branch and this feels very much like another bail in the coffin for the High Street. ’ The bosses of all the major banks have justified the closure of branches by stressing the soaring popularity of digital banking – both online and on smart phones . They have also argued it is not viable to keep certain branches open because so few customers use them . Royal Bank of Scotland boss Ross McEwan last year described its busiest branch as the 7.01am train from Reading to London Paddington , with over 167,000 using its mobile banking app between 7am and 8am on their commute to work every day . The British Bankers ’ Association says internet and mobile banking is now used for transactions worth £6.4 billion a week – up from £5.8 billion last year . But according to charity Age UK , more than a third of older people have mobility problems making travelling long distances to their nearest branch difficult . Almost 15pc have limited dexterity which means it is hard to use the internet while 4.8 million people aged 65 and over have never been online . Caroline Abrahams , charity director of Age UK said : ‘ Accessing cash and paying bills are essential services which must be easily available to everyone . But the combination of bank and building society closures , particularly in rural areas , and the industry ’ s growing reliance on online services mean access has become increasingly difficult for many older people. ’ Vince Cable has said that the Post Office can play a vital role in providing an alternative for bank customers . Most banks already offer basic services via the Post Office ’ s 11,500 branches .
Biggest lenders refused to commit to never shut ‘ last bank in town ’ Bank bosses are blaming branch closures on online banking . Vince Cable described the new ‘ protocol ’ as a ‘ major step forward ’