Regional variation in banking services and social exclusion

The paper examines the argument that the concentration of banking in large urban areas could result in social exclusion. There are those who fear that customers living in peripheral regions will suffer discrimination, and businesses will decline. An alternative view is that the geographical proximity of banks in an age of electronic communication is not needed. These conflicting views are examined in the context of the literature on statistical discrimination. It is concluded that it would be unwise to write off the importance of geography in the location of financial services.