Regional Economic Development Minister Shane Jones: The announcement was the first sign of hope for regional communities. Photo / John Stone
Regional Economic Development Minister Shane Jones: The announcement was the first sign of hope for regional communities. Photo / John Stone
New Zealand's biggest banks have promised not to close any provincial branches while the Government trials regional banking hubs across the country.
This comes amid concerns that banks in some of New Zealand's regional centres could close due to the lack of demand for their in-house services.
Regional Economic DevelopmentMinister Shane Jones said the announcement was the first sign of hope for regional communities, many of which have lost their face-to-face banking facilities.
From next year, banking hubs – which will provide basic transactions services like cash withdrawals, deposits and account transfers – will be trialed in Martinborough, Opunake, Stoke and Twizel.
Each hub will have a multi-branded Smart ATM as well as a support person to provide assistance.
Today's announcement has been in the pipeline for some time.
This time last year, Jones took a swipe at big-banking telling Interest.co.nz he had been approached by people who were "pissed off that the range of banking services in the regions are being dialled back at a time when their profits are stupendous".
Jones took the issue up the chain and he, alongside Finance Minister Grant Robertson and Associate Finance Minister David Parker, met with Reserve Bank Governor Adrian Orr about the issue in September last year.
A briefing note written by Orr for the meeting, obtained under the official information act at the time, revealed the Reserve Bank was aware of the situation. "People aren't using bank branches as much or in the same way as they used to," Orr said in the briefing.
"The New Zealand Bankers' Association note that in the past five years, about 70 per cent fewer people have been using branches nationwide."
In fact, Orr said one bank had told him that more than 50 per cent of its total customer transactions were conducted online.
"These trends are set to continue."
Jones said whānau, personal and business finances require close contact with a bank and many people prefer face-to-face contact over online services to manage their financial matters.
"For many people in regional New Zealand, that choice had been taken away from them." He added that he thinks the participating banks would be surprised by the enthusiasm of which these communities will embrace the new banking hubs.
Robertson said he hopes the hubs would be a solution for both the banks and the local communities where it may not be economical for individual banks to maintain a branch.
