Regional Communities Seek Banking Alternatives Amid Major Bank Closures

In a significant blow to regional banking services, Bendigo Bank announced on July 25, 2025, its decision to close 28 agency services across Australia. This closure leaves many small towns, including Cunderdin, Western Australia, grappling with diminished access to banking facilities. Residents of Cunderdin, located approximately 160 kilometers east of Perth, now face a daunting 120-kilometer round trip to access alternative banking services, which has raised concerns among local officials and community members alike.
Cunderdin Shire President Alison Harris expressed her dismay at the closure, stating, "A bit like doctors and grocery shops, the bank is vital in a small community." She emphasized that the bank's exit is a significant reduction in services that residents had come to rely upon, particularly after many had transferred to Bendigo Bank following the departure of Westpac. The agency, situated within the town's co-op service, provided essential banking services, including cash access and support for local events.
Bendigo Bank's spokesperson cited "decreasing customer use" as the rationale behind the closures, a decision that has drawn ire from community leaders who argue that the agency's presence was crucial for local economic health. According to a statement released by the bank, affected customers will be directed to their nearest alternate services, which are located in the towns of York and Northam, necessitating lengthy travel for residents.
Simon Lyons, CEO of the Traditional Credit Union (TCU), an Indigenous-owned financial institution, underscored the broader implications of bank closures in remote areas. Founded in response to the withdrawal of major banks from Indigenous communities in the Northern Territory, TCU represents an alternative banking model that could provide sustainable solutions. Lyons argued, "If you go into any community that has lost a bank, they will tell you exactly how devastating it is." He highlighted that closing locations puts local businesses at risk and makes it increasingly difficult for residents to manage their finances without access to a physical bank.
The issue of banking in rural Australia is not new; it has been a growing concern for several years. In February 2025, Treasurer Jim Chalmers announced a moratorium on regional banking closures by the major banks, effective until July 2027. This decision sought to compel banks to invest more in regional services, acknowledging that banking is an essential service, particularly in remote areas. However, local leaders like Harris argue that more proactive measures are necessary to protect the interests of regional communities.
To combat the service gap created by bank closures, some regions are exploring partnerships between local councils and smaller banks. For instance, Hume Bank has collaborated with Hume Council in New South Wales to establish a banking branch within the council office, allowing residents to access essential banking services without the need to travel long distances. Hume Bank's CEO, Stephen Capello, stated, "Regional Australia needs a socially responsible banking industry, and that needs to reflect some of the heavy lifting that small regional banks and community and customer banks are doing at the moment."
Additionally, the Finance Sector Union (FSU) has raised alarms regarding the unilateral cuts to banking services, calling for government intervention to ensure that banking remains a regulated essential service. FSU Assistant National Secretary Nicole McPherson highlighted that it has been over a year since a Senate inquiry called for such regulations, emphasizing the need for immediate action to safeguard both bank workers and customers.
As rural communities adapt to the loss of traditional banking services, the emphasis on community banking models and partnerships with local governments may represent a viable pathway forward. The challenges faced by towns like Cunderdin illustrate a pivotal moment in the evolution of banking in Australia, where the necessity of equitable access to financial services is increasingly critical to the sustainability of regional economies. The future will likely see a greater reliance on innovative banking solutions designed to meet the unique needs of these communities, ensuring that they are not left behind in an ever-evolving financial landscape.
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