ABA CEO interview with ABC Melbourne’s Charlie Pickering on regional banking

E&OE
Radio Interview
Interview ABC Melbourne
8 October 2026

Topics: Regional banking

Charlie Pickering: We’ve seen so many of them closed, and you know it’s funny. Sometimes you don’t even realise the branch is gone until you really need it, and you go down there and it’s not there. So many of them have closed down, particularly in our regional areas. Give me a call: 1300 222 774. Tell me if you still use the physical bank branch. Do you need to use one? It’s always for a problem you can’t solve on the app, and you can’t find a branch. Let me know: 1300 222 774.

And I’m asking because the Australian Banking Association has a new plan. It sounds like it could be a pretty good idea. It is to open multi-bank hubs in areas where there are no physical bank branches. So, how exactly would it work, and could it work for you? Let’s find out. Simon Birmingham’s the CEO of the Australian Banking Association and joins me now. Good afternoon, Simon.

Simon Birmingham: G’day, Charlie. It’s great to speak with you again.

Charlie Pickering: Great to have you with me, with your banking hat on this time. So, tell us how this would work. We’re used to the banks being in fierce competition for our mortgage business, how are they going to work together?

Simon Birmingham: Well, indeed, in no way is this intended to take away from that fierce competition for people’s deposits, for people’s loans. You know, ultimately, people want the best rates, the best terms, and we’re very clear that that intention is to remain, and it’s only been getting fiercer. But what we have asked the ACCC to allow banks to do is work together on a couple of things.

Firstly, what we’re calling regional service commitments. So, really, for us to explore as an industry what is happening in terms of branch and banking access in our regions, and how can we design some commitments that give certainty to communities that those services are going to be available in the future. And then secondly, as part of that, to trial what we’re calling regional banking hubs, and we’re looking to trial up to 10 of those sites, which would be done in towns that don’t have any branch in them at present, and where we would really be seeking to test different models of how banks can together have some face-to-face services provided in the community that can ensure that as people have largely turned away from using bank branches – you know, 99% of transactions happen digitally nowadays, and the actual use of bank branches has plummeted by more than 60%. But we know, as you said in your intro, there are times and circumstances where people, either in an instance of vulnerability or because of broader circumstances, do value that face-to-face access, and we want to try to find cost-effective ways of getting that to people for the times that they do need it.

Charlie Pickering: 1300 222 774. If you live in an area where a bank branch has closed recently, does this sound like something that you would like to see? I’d like to know. 1300 222 774. Simon, you mentioned there that it obviously serves particularly regional areas where they don’t have a bank branch, or maybe the last bank branch in town has recently closed. But I got a text here from Anna who asked the question: “Why is Commonwealth Bank closing branches in Eltham and Thomastown? The demographic needs local, easy access to banks.” And I’m curious: Could we see these multi-bank hubs also maybe in those areas closer to the city where banks have been closing branches?

Simon Birmingham: We don’t want to get ahead of ourselves, and we’ve got to take this carefully because we are, as I say, having to get permission from the ACCC to do this all within the boundaries of competition law, and it’ll take at least a couple of years for us to go and properly test, you know, sort of how this model works. What we are envisaging is testing a couple of different models. One would be in those regional towns, something that looks very much like a bank branch, except it’s not branded for any particular bank. But it would have, you know, ATM facilities, coin facilities for small businesses and a real live human being there to help people use those and to help them address other banking needs and circumstances they may have.

But in other cases, what we’re looking at trialling is, can we use some existing local infrastructure and service providers – local councils, local libraries, or local post offices who already provide valuable Bank@Post service – and that they might be able to serve some of those hub features and provide a bit more than the basic cash transactions that the Bank@Post model provides of value today, and help to address some of those gaps that we know can happen for those who, without it, may have quite long distances to travel to otherwise get to a bank branch.

Charlie Pickering: Obviously, exactly how this works will decide how happy people are with it. But has it been tried, similar things to this overseas? Is there somewhere we can learn from?

Simon Birmingham: There are a couple of different models. So, New Zealand has commenced a trial a few years ago, they haven’t expanded beyond that trial, to be honest. But I know they’ve been looking and learning, and we are certainly engaging with them to understand some of how that can best work. The UK has a more expansive model. It’s in the midst of a review at present, but it’s got a lot more locations tied more in partnership with their postal service too. So, this is a global phenomenon unsurprisingly right around the world, people have switched from banking as we used to know it to do most things digitally. Not everyone, and not all the time, but it definitely changes the economics of running bank branches.

And so, this is one way in communities with sparser populations and greater distances to travel, and sometimes also additional vulnerabilities, and in communities that might have a higher age demographic or other cohorts with extra vulnerability, that we want to try to see how can we address this. Because as an industry, we do know that when it comes to the crunch, even people who overwhelmingly use digital banking do, at some points, really value the access to somebody face to face to help them, and that there are some who need that on a much more routine basis too.

Charlie Pickering: And as you say, there are some things that you just can’t do online. You know, opening a bank account for one of your kids to teach them how to save isn’t something you can do easily online. You have to go and have an actual meeting at the bank, show if you’ve actually got a kid. And there are many other – if you’ve got a cheque, you’ve got no chance unless you have a bank. You know, we’ve got a few texts coming in, and one of the suggestions is like, until we have these hubs, couldn’t the solution be just not closing these regional branches until we have a solution in place?

Simon Birmingham: So, the major banks do have a moratorium on branch closures in place, and for a couple of them, Westpac and Commonwealth Bank, they have extended that out all the way through till 2030. So that provides certainty in relation to those services, and look, overwhelmingly, branches – proprietary branches owned, operated, branded by an individual bank – will continue to be the way that services are delivered. And that first thing I spoke about, the regional service commitments, will really be as an industry looking to shore up and demonstrate how it is that banks themselves will continue to deliver those services, and that includes how they make sure that there is accessibility for those who need it to get online, even when that may not always be something that they’ve done. So, we need to build that out further, so we don’t have people left behind. But we also, as I say, are doing this and trialling the hubs because we know there’s a time, there’s a place where face-to-face support is possible. Oftentimes, you know, that person in that hub may well be able to basically help a customer resolve their issue using those digital tools, but the customer will have a skilled person there able to help them resolve it, so they’re not left to fend for themselves in doing so.

Charlie Pickering: Well, there’s definite potential there, and we’ll be watching keenly to see how it goes and how long it takes to jump through those regulatory hoops. Simon Birmingham from the Australian Banking Association, thanks for talking us through it this afternoon.

Simon Birmingham: Thanks, Charlie. My pleasure.

Ends