Banks running out of credit with fed-up rural communities as branch closures continue

Rural communities are desperately searching for ways to keep banks from shutting up shop in their towns.

Banks are blaming a decline in foot traffic and an increase in online activity for proposals to close or reduce services.

Kiwibank has flagged it may close seven branches including Matamata, Waihī, Balclutha, Gisborne and Waipukurau.

The bank said it was responding to customer preference. Branch visitor numbers had not recovered since more customers began using online services during the 2020 lockdown.

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ASB planned to reduce hours at Matamata, Te Awamutu and Cambridge and close its Morrinsville branch in March.

ANZ was reducing its Te Kūiti branch from a five-day operation to Tuesday to Thursday, from April 21.

Waikato Federated Farmers President Jacqui Hahn, who farms near Te Kūiti, said it was a double blow for her rural community.

Cheques had already been removed as a method for people to bank and poor internet service in rural areas made it difficult for people to connect with their banks online.

Reducing the ANZ branch service in Te Kūiti would make it even more challenging for people to access banking services.

“I do know that there has been a massive reduction in foot traffic, it is understandable that banks would look at reducing face-to-face interactions.

“However having dealt with another bank that has reduced hours, the level of service falls dramatically and I believe the bank that keeps that face-to-face local service is more likely to benefit from more customers.”

Hahn said agribusiness bankers do make visits more often than in the past.

“But what about new staff, teenagers opening accounts, power of attorney changes, clubs and societies changes in signatories?”

Hahn said her solicitor was considering moving to a main centre if banks exited the community.

“They have to meet face-to-face and their time is very expensive, stripping more jobs and desirability out of townships.

“Overall I am not impressed with the banking bodies and their shareholders’ attitudes towards the communities they have greatly profited from.”

Matamata-Piako Mayor Ash Tanner said he was baffled to understand why banks were moving out of town.

“They are usually quite profitable businesses and it has a huge impact on our communities.

“It’s not just a bank. For some of our elderly people, it’s also a social thing. They interact with people and they have a very good relationship with staff.

“It’s about personal connections and people will miss that.”

Matamata resident Pam Chubb wrote to Kiwibank suggesting it share premises with another shop so it could remain open in the town.

She said the population of Matamata was growing, businesses were expanding and it would be “foolish” to close.

“Also there must be consideration given to the number of, and proposed, care homes where older clients need banking facilities especially now that cheques are gone.

“They cannot do online banking for various reasons such as inability to grasp such procedures or health reasons such as arthritic hands that make dialling and texting beyond their capability.”

Kiwibank said it was mindful the proposal to close the seven branches would create uncertainty.

It was seeking feedback to hear how customers were using the branches and what support they might need to access services.

South Wairarapa Mayor Alex Beijen delivered a petition to Parliament on behalf of 33 mayors urging banks to reinstate rural branches.

In a column for the Wairarapa Times-Age, he said the closures were “a case of maximising profit at the expense of our communities”.

In the past five years, seven ANZ branches closed across the Waikato.

One new branch was opened at The Base, four branches had their hours reduced and three became dual service.

ANZ said customers normally use mobile banking a few times a day but visit a branch just a few times a year.

It was a similar situation for ASB. Customer visits to several Waikato branches declined by almost 25 per cent over the past three years.

Westpac set up 14 Smart ATMs in Waikato, after a “dramatic uptake” in online banking and a drop in visits to branches in recent years.

For every transaction over the counter, there are now 100 customer log-ins to online banking, a Westpac spokesperson said.

“We closed branches in Ōtorohanga, Putaruru, Raglan and Te Aroha in 2016. A branch in Hamilton East closed in 2019.”

Some branches have also reduced opening hours.

For BNZ, three branches in Te Rapa, Putaruru and Paeroa closed in the past five years, leaving just 13 locations for bankers to do business.