Lloyds To Shrink Size Of Branches, Get Rid Of Service Counter

Lloyds Bank of the U.K. announced it is gearing up to reduce the square footage of hundreds of its branches, and in some instances, it’s getting rid of the counter service sections.

According to a report, the new so-called micro branches will be staffed with only two people who will aid customers in using the bank’s machines. Some of the banks that will be converted into small branches include the ones in Halifax and Bank of Scotland, noted the report. Lloyds said the move was prompted by “a profound change in customer behavior” with a lot of the transactions moving online. Lloyds had previously announced plans to shutter nearly 400 branches in the U.K., which will result in the loss of 9,000 jobs.

“We have a lot of branches that used to have a lot of footfall and therefore feel quite empty and intimidating for customers,” said Jakob Pfaudler, Lloyds’ chief operating officer for retail, in the report. “So when there’s too much space, we may board up places in existing branches.”

Taking a page from Apple and the Apple store, the branches won’t have counters and staff will walk around with a tablet device to aid customers. There will also be video links so that customers can interact with a mortgage adviser. For more complex transactions, customers will still have to visit one of the traditional branches. The first, a Lloyds branch, will open in the center of Manchester later this year, followed by a flagship Halifax branch in central London.

In last December, Which?, the research firm, found that U.K. bank HSBC has closed more than a quarter of its branches in its hometown during the course of the past two years. According to a report, citing the research from Which?, the closures are part of 1,000 closures of bank branches in total for HSBC. Since January 2015, HSBC has reportedly closed 321 branches, which accounts for 27 percent of its bank network.

Meanwhile, Co-operative Bank closed greater than half of its bank branches during the same timeframe that the HSBC branch closings occurred. Co-operative Bank is a lot smaller than HSBC. HSBC said in the report that the bank closures are due to the fact that the lion’s share of its customers bank on smartphones or via the internet.