The issue of rural bank branch closures has been around for some time.
We have often written that we believe the banks have provided other means for the rural community to do their banking. It would appear that the Federal Parliament’s standing committee on financial institutions feels the same way.
For almost a year this committee has been conducting an inquiry into banking services in regional and rural areas. The committee has decided not to recommend legislation to force banks to fund banking services in rural areas.
While the Australian Bankers Association proposes to work with community groups to develop strategies to combat the issue, the Australian Consumers Association seems to doubt them;
“How can they ask us to trust them for a voluntary response when they have failed to deliver that in the past?” said Ms Mara Bun in the Australian Financial Review.
Expecting banks to keep branches open in areas where the branch is making no money is like offering a farmer a piece of land which no matter how hard he tried always ran at a loss. Undoubtedly he would make the commercial decision that the land was not worth keeping, in much the same way as banks have made the decision that having branches servicing relatively small numbers of people is commercially unwise.