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Rural Bank customers abandoned

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The H on. W a rre n Truss, MR Minister for Customs an d Consumer Affairs Deputy Leader of the House

26 April, 1998

RURAL BANK CUSTOMERS ABANDONED Rural consumers are being treated with contempt as the major banks withdraw their commitment to the bush, the Minister for Customs and Consumer Affairs, Warren Truss, said today.

The Minister said he was dismayed by the comments made by the Managing Director of the National Australia Bank, Mr Don Argus, who told a Parliamentary Inquiry last week that the NAB will continue its closure o f bush branches and will not participate in other programs to provide alternative branch services to regional Australia. ,

“The banks’ attitude that a local branch is just a social experience displays the lack o f commitment which they have to consumers in regional and rural Australia,” Mr Truss said.

“But there are options which could benefit both consumers and small businesses in rural and regional areas. The banks could take up the option of “market sharing”, providing their services through giroPost (run by Australia Post), or through regional banking franchises or agency arrangements

“With a positive outlook, banks could be part o f these arrangements which would alleviate the problems o f consumer access to banking services while, at the same time, providing opportunities for small businesses seeking franchise or agency arrangemerits.”

The Minister said the closure of a local bank branch was more than just the loss of a local business. For many country towns, the loss o f a bank is the death knell for local businesses which lose a service to deposit cash, draw change or bank cheques.

“The business o f banking is woven into the very operation of the community and banks do have obligations to the community which they service.

“Consumers should be aware that where a bank ignores its social duty to the community, they are entitled to vote with their feet and take their business elsewhere, to emerging financial institutions, such as credit unions and building societies, many of which are demonstrating a stronger service ethic.”

Mr Truss said the Federal Coalition Government had acted to de-regulate the banking sector and allow other financial institutions to provide banking services.

“I am pleased that there is now an emergence o f credit unions and building societies in many o f the country towns which have had services withdrawn by the big banks,” Mr Truss said.

“In addition, the Federal Government offers financial assistance through its CreditCare program to rural communities affected by the closure o f local financial services.”

Contact: Ref: 104/98 C M R 1054

A n d re w Hall — M e d ia Adviser — 02 6277 7790 0419 996 766 Email: a h a ll@ d is t.g o v . a u W e b sites: w w w . d i s t . g o v . a u w w w . c u s t o m s . g o v . a u