The Big Four banks have agreed to keep their regional branches open until at least 2027, under a new deal struck with the federal government.
About 36 per cent of bank branches in regional Australia have closed since 2017, according to the government, leaving many communities without a physical location to withdraw cash or open an account.
NAB has now agreed to a two-and-a-half-year moratorium on closures, while Commonwealth Bank and Westpac will extend their existing agreements.
This brings all the major banks in line, after ANZ agreed to halt closures as a condition of its takeover of Suncorp Bank in 2022.
It means no additional regional branches will close their doors until at least July 2027.
Commonwealth Bank, NAB and Westpac have also reached new in-principle agreements with Australia Post’s banking service, Bank@Post, while ANZ has agreed to terms on which it will sign up.
Macquarie Bank and HSBC will also begin negotiations to join.
ANZ was previously part of the service, but its customers were unable to use the service from the start of 2019 when the bank ended its contract with Australia Post.
The service allows their customers to do basic banking — like withdrawing cash or checking their balance — at post offices.
Treasurer Jim Chalmers on Tuesday acknowledged that digital banking was increasingly the way forward, but that the government also wants to ensure face-to-face services remain available to people in the bush who need them.
“We know that if we want a strong national economy, then regional Australia needs to be a big part of the story, and that means making sure that banking services are available to the businesses and workers and people and communities of regional Australia,” he said.
An earlier solution floated by the government involved forcing banks with little to no presence in the bush to pay a levy to support regional branches.
“You would recall towards the end of last year, there were other options and other potential steps flagged as a consequence of some confidential consultation that we were undertaking,” Mr Chalmers said.
“That work will continue.”
Moratorium provides ‘breathing space’
Outgoing Australian Banking Association chief executive Anna Bligh also acknowledged that there was a “massive transformation” taking place in the banking sector and the moratorium provided some “breathing space” while that was underway.
“I am very confident that the moratorium will effectively give us that breathing space to look at the things that Australia is good at, finding innovative ways to service very remote locations,” she said.
“As we see more and more Australians jump online to do their banking, we are going to see a continued digital transformation.
“Our job collectively is to make sure we don’t leave any Australian behind as that transformation accelerates, and that’s what today’s announcements will do.”
Australia Post chief executive Paul Graham said the improved arrangements would ensure about 3,400 post offices could continue to provide “essential banking services in the many communities where there are no other banking services available”.
