Banks have been an integral part of the Australian story since the first branch opened in 1817.
You used to be able to count on there being 2 features of every Australian town no matter how big or small: a pub and a bank. In the last 25 years the big 4 banks have been leaving regional and rural Australia in droves, devastating local communities, creating huge service gaps, and putting local economies under severe pressure.
What happens to a community when a branch closes?
Branch closures cause a number of hassles for local residents and local business:
- Anxiety, concerns around safety and security;
- Extra costs;
- Loss of key financial services;
- Loss of an essential service;
- Extensive travel to access face to face banking services;
- Loss of economic opportunities.
How many bank branches have closed in recent times?
Since the beginning of 2017 the big four banks & their affiliates and other mid size banks, have closed hundreds of branches across Australia – but most closures have occurred in regional Australia.
Do the banks really care about the impact of branch closures?
Branch closures are often planned several years in advance and are commercial decisions, and there is no doubt some level of concern about the impacts these closures have on local communities; however there is also a cynical side to the closures. We learned via the Royal Commission into misconduct in the financial sector that the ANZ are willing to cop the bad publicity associated with closures because for most of their customers it is too much of a hassle to switch their bank accounts in protest.
Banks and Technology
The most commonly cited reasons for closures from the banks is that their customers are moving their transactions to internet banking or ATMs and most people don’t have the inclination or the time to go to a branch. There is still a very large cohort of people who want face to face banking services and who don’t use web banking. Web banking is not much use if you have an unreliable service provider and your internet keeps going down. Reliable internet is still a very real issue for people in regional and remote communities. Banking alternatives such as Australia Post and Post Office agents provide a limited range of services.
Economic and social costs of closures
When a branch closes in a regional and remote community jobs are lost and this has a flow-on effect to local retailers. Suddenly there are fewer people buying goods and services from local suppliers such as the local supermarket, baker, and pub. In order to seek work people move away taking their families with them so the local school become smaller, the local footy, cricket, and netball team have fewer players and supporters. Skills and experience are lost.
FSU Media and Member Updates on closures
Click here to see a range of FSU publications about the issue of Branch closures across Australia.
Other info on bank closures and service reductions