Staff at a new Commonwealth Bank branch told a reporter from Daily Mail Australia that he could not withdraw cash inside, as the big banks continued to limit access to physical money.
National Australia Bank has joined ANZ and Commonwealth in the trend to open ‘cashless’ branches, and interviews with members of the public show that most people are concerned about restrictions on being able to access their own money on their own terms.
Daily Mail Australia visited a Commonwealth Bank specialist center in Sydney’s Barangaroo on Wednesday only to be told to go elsewhere.
‘So there’s no cash here?’ asked our reporter.
‘That’s right, we are a specialist centre. We have an ATM,’ replies the Combank employee
‘Is it a bank or not?’
‘It’s a bank but it’s a specialist center bank! The nearest branch where you can withdraw money is a five to 10 minute walk down George St.
Daily Mail Australia visited a Commonwealth Bank specialist center in Sydney’s Barangaroo on Wednesday only to be told to go elsewhere for cash.
The shift to digital transactions has raised many concerns, including the impact on older Australians who are unfamiliar with online banking, and regional communities who may have to wait days for a faulty payment system to be fixed.
A cashless society means being a bank customer and paying their fees, as well as raising privacy concerns in a society where every purchase of any product or service can be tracked and tracked.
Customers are also at the mercy of technical problems, unable to pay for anything during periods when their bank suffers a technical problem.
”It’s crazy. It’s our money, and we still need and want to use cash,’ one frustrated bank customer told Daily Mail Australia when interviewed on the street.
‘What right does a bank have to say that we can transact the way we want to transact?
‘It’s all about fees. They want everyone to use EFTPOS so they can ditch the little fees that go into their billions in profits every year.’
Another said he saw the reasoning behind it from a banking and government perspective, as it would effectively kill the black economy of cash payments.
‘I can see why it’s happening,’ he said. ‘In a cashless society, you can track where people are spending their money, so we can’t avoid tax.’
Commonwealth Bank opens specialist branches that do not offer over-the-counter withdrawals and deposits
New specialist centers similar to NAB offer ‘more space for appointments and digital banking support’ by replacing face-to-face teller transactions with smartATMs located on site.
NAB Expert Centers reserve their personal customer service for loan products, new accounts, business banking and teaching customers how to bank digitally.
Like CommBank’s specialist centres, they are located close to ‘traditional branches’ in Sydney, Melbourne and Brisbane.
But the broader shift towards self-service for ‘everyday banking’ is not limited to metro areas where an alarming number of regional branches – where banks were once a pillar of local communities – are going cashless or closing entirely.
NAB has also gone cashless at two locations in Geelong, Victoria and one in Broadbeach, Queensland’s Gold Coast.
Shifting to electronic payments means more fees may be imposed on customers, especially when independent ATMs are used.
Many Australians are even deliberately choosing to pay in cash, because whenever bank cards are used, some money is inevitably eaten up by fees, which shop owners are forced to pay.
Queensland mother Fiona Edmonds recently explained that physical money retains its value no matter how many times it is used.
‘But if I come to a restaurant and pay digitally with a card, the bank fee for my payment to the vendor can be up to 3 percent or $1.50.’
Ms Edmonds said the same percentage is charged on every other transaction using that principal $50 if the holder pays via tap-and-go.
Staff pictured at a cashless Commonwealth Bank branch in Penrith where deposits and withdrawals can still be made via on-site ATMs
‘Payments made by laundry shop owners, barbers and so on. So after 30 transactions the initial $50 will exist at only $5 and the remaining $45 has become the property of the bank.’
Effie Jahos, editor-at-large of Canstar, Australia’s largest financial site, said in May that she felt for consumers as well as small business owners.
Average merchant fees for payment types
Eftpos: Less than 0.5 percent
Visa and MasterCard Debit: Between 0.5 percent and 1 percent
Visa and MasterCard credit: Between 1 percent and 1.5 percent
American Express: Between 1.5 and 2 percent
Source: Reserve Bank of Australia.
Ms Jahos said the Eftpos fee is about $0.34, the MasterCard fee is about $0.47, while Amex is ‘much more expensive’ with a $1.34 surcharge.
He added that the fees themselves did not rise but were affected by the cost of living.
‘We see inflation numbers still at that 7 per cent, so the price of what we buy has gone up,’ Ms Jahos said.
‘So guess what? The fee we pay on that card increases as a percentage.’
While large businesses typically absorb merchant fees, most small businesses will pass the fee on to their customers, raising the cost of products, Ms Jahos said.
Although a simplified example and fees vary widely between banks, the gist is correct.
The remaining ‘big four’ banks are taking a different approach to streamlining their businesses by consolidating their branches with brands such as Westpac, St George’s, BankSA and Bank of Melbourne.
The ‘co-location’ strategy launched by mid-2022 seeks to consolidate 100 bank branches by the end of this year, many in regional locations.
Bega and Dubbo in country NSW, Alice Springs and Darwin in the Northern Territory and Port Pirie in South Australia are some of the locations where Westpac has consolidated branches.
Smaller banks outside the big four are also being affected by the upswing as banks reassess the profitability of their brick-and-mortar branches as customers manage their accounts online.
In 2021 the Bendigo Bank Community Bank branch at Doreen and Merinda in Melbourne’s outer north decided to ‘convert to a cashless site’.
“We plan to provide services that the community is using and benefiting from, removing expensive services where demand is declining, expected to decline or is no longer needed,” the bank said in a letter to shareholders. said in the letter.
‘These operational changes are intended to help stabilize our current financial situation, with a long-term view of trying to achieve profitability.’
‘The transition to cashless branches is a change that has now been adopted by several other branches in the Bendigo Bank network.’
‘The relaunch of the branch will require some internal changes and a new layout will provide the full range of banking services expected by our customers including the appointment of a full-time mobile banker.’
Dutch-owned Rabobank, which has more than 50 locations across the country focused mainly on regional and agri-business customers, does not offer over-the-counter cash transactions.
It directs customers wishing to transact in cash to visit the Bank@Post outlet at Australia Post Offices.
More than 1600 bank branches across Australia closed between June 2017 and June 2022, according to the Financial Services Union.
‘A disproportionate number of these branches are located in regional Australia… Furthermore, it appears that without intervention this trend will continue, leaving more regional communities in its wake,’ the FSU said.
The Federal Government’s Rural and Regional Affairs and Transport Reference Committee launched an inquiry into the closure of regional banks on February 8 this year.
The inquiry will examine regional bank closures, their impact and possible solutions, with a report by December 1, 2023.
The shrinking of real bank services across the country may be more dramatic than the statistics show.
News website The Regional found discrepancies in 2021 among hundreds of bank locations classified as branches that do not offer face-to-face cash services.
A bank location must offer in-person cash transaction services to be classified as a ‘branch’ for reporting purposes to the Australian Prudential Regulation Authority, which collects data on the bank’s ‘point of presence’.
Under the Financial Services (Data Collection) Act 2001, self-service ATMs are classified as a different service channel.
An APRA spokesperson told the publication that some locations are classified as branches but only offer self-service ATMs for those who do ‘everyday’ banking.
Daily Mail Australia interviewed some Sydneysiders who were undecided about how the change would affect them.
‘In cases where branches were staffed and customers were given the ability to withdraw or deposit cash using ATMs, APRA considered that those facilities continued to meet its definition of a branch,’ an APRA spokesman said.
Treasurer Jim Chalmers has since said that locations that have withdrawn teller service and forced customers to use ATMs do not meet the legal definition of branches.
APRA has substantially revised their classification data since The Regional’s report.
Lance Blockley, managing director of payments consulting firm The Initiatives Group, said more bank closures are likely.
‘There’s probably still a place for branches, but they can be smaller formats and you’re already seeing that in some of them. There will be fewer of them, and you will have more mobile bankers,’ Mr Blockley told the Sydney Morning Herald earlier this year.
ANZ CEO Shane Elliott recently told a parliamentary hearing that customers should not use cable branches.
‘What we find is… a lot of people bemoan the fact that branches are closing but they don’t actually use them,’ he told the House of Representatives economics committee in Canberra this month.
‘And even when we provide alternative solutions, usage is extraordinarily low because people actually like the convenience of being able to do things digitally.’
‘Only eight per cent of our customers use only one branch and we don’t have any kind of digital relationship,’ he said.
‘It’s going down fast.
‘Most of them are actually more likely to be small business operators, with more complex needs than small business people.
‘Retail customers are generally quite well served on a digital basis.’