Regional Victorian councils are taking up the cudgel for residents and businesses affected by the closure of local banking services.

Bendigo and Adelaide Bank informed residents in a letter dated March 28 that it is shutting down its Bendigo Bank agency in Stawell, in the state’s Grampians region, at the end of June, citing a shift towards phone and internet banking.

It’s one in a string of bank closures across regional Australia, which are currently the subject of a Senate inquiry.

Northern Grampians Shire Council Mayor Kevin Erwin says he’s been inundated by calls from residents of Stawell and surrounding towns devastated by the decision, which he said will also affect local business and take money away from the shire.

Council has contacted the bank to convey the concerns of residents and the impact the closure will have on the community, but the bank remained firm in its decision, he Cr Erwin said.

A ‘smack in the face’

Many local residents were elderly and relied on face-to-face interaction with bank representatives they knew, Cr Erwin said.

“The cessation of the Stawell Agency service is seen by people here, myself included, as smack in the face,” he said.

“The opportunity to offer people trust and security in a time where scamming, impersonation and digital identity theft is rife should not be abandoned. We’re all very disappointed.”

Councils left to mop up

East Gippsland Shire has also been hit by bank closures.

In a submission to the senate’s rural and regional affairs committee, the council says banks need to consider the social impacts of their decisions, especially when they are made without consulting local communities.

It comes after Bendigo Bank terminated its agreement with Council to provide banking services from the Omeo Service Centre, while its Lakes Entrance agency will close on June 30.

“Bank branch closures are felt far and wide, but for regional communities it seriously hurts,” the submission says.

“Much of the aftermath and angst caused by a branch closure is left to the Council to ‘mop up’ with its community.”

The submission goes on to say the East Gippsland council is ‘doing its bit’ by investing in local financial institutions, including Bendigo Bank affiliates. It says it has $2 million invested in Community Banks, and asks “where is the reciprocity?”

Viability of agency model under pressure

Bendigo and Adelaide Bank said the agency model was established several decades ago to supply limited banking services via third parties in areas where demand was insufficient to to sustain a branch.

“As the number and value of over-the-counter transactions has fallen and more customers choose to do their banking online and over the phone, the viability of the model has come under pressure and has been placed under review.

“As part of this process, the bank has begun to review a number of agency agreements,” a spokesperson said in a statement to Government News.

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