Bank Branch Closures and Staff Cutbacks in Peripheral Areas of the European Union: Impact on Micro and Small Enterprises Sustainability. An Evolutionary Perspective

This research investigates the effects of bank branch closures and staff reductions in peripheral regions of the EU, analysed through evolutionary models. The focus is on understanding how these disruptions affect the resilience and adaptive capacity of MSEs, which serve as vital components of the regional economic ecosystems. As bank branches retract, the economic habitat of these businesses suffers from reduced access to essential resources such as credit and financial advice, ultimately threatening their fitness within an increasingly competitive economic landscape. Findings of a mixed-method approach based on quantitative and qualitative analysys suggest that the banking service reductions function as selective pressures, intensifying competition for financial resources and increasing the economic vulnerability of MSEs, particularly in areas where alternative financial services are scarce. This disruption affects the overall ecosystem model of rural and semi-rural economies, where MSEs are crucial for maintaining local trophic levels and ensuring economic biodiversity through diverse business activities. The study reveals that the closures reduce the carrying capacity of peripheral regions to support MSEs, leading to higher rates of business closures and weak economic evolution. To enhance the resilience and sustainability of MSEs, the research advocates for policy measures to preserve a basic level of physical banking infrastructure or promote symbiotic partnerships between the public and private sectors to ensure financial inclusion. Such targeted interventions are critical for maintaining the adaptation mechanisms necessary for MSEs to prosper and contribute to the broader economic health of the EU.