The head of Australia's financial complaints authority has sounded the alarm on a growing crisis, warning that the rapid closure of bank branches and decline of cash availability are pushing vulnerable Australians into severe financial hardship.
The Perfect Storm for Financial Exclusion
David Locke, chief executive and chief ombudsman of the Australian Financial Complaints Authority (AFCA), has revealed that his organisation is witnessing firsthand the devastating impact of banking changes on everyday Australians. The combination of disappearing local branches and reduced cash access is creating a perfect storm that disproportionately affects elderly, regional, and disadvantaged communities.
Who's Being Left Behind?
Locke identified several groups bearing the brunt of this financial transformation:
- Older Australians who rely on cash and face-to-face banking services
- Regional and remote communities where branch closures eliminate essential services
- People with disability who find digital banking challenging to navigate
- Those experiencing financial abuse who depend on cash for safety and autonomy
The Human Cost of Banking Modernisation
"We are hearing very concerning stories from our stakeholders, particularly in regional and rural areas, about the impact of bank branch closures and the decline of cash," Locke stated. The AFCA chief emphasised that while digital banking offers convenience for many, the transition is happening too quickly for significant portions of the population.
Beyond Convenience: When Cash is Essential
For many Australians, cash isn't just a preference—it's a necessity. Locke highlighted situations where digital alternatives simply don't suffice:
- Emergency situations during natural disasters when digital systems fail
- Budgeting tool for people managing fixed incomes or financial stress
- Essential for small businesses in areas with unreliable internet
- Critical for those escaping financial abuse who need untraceable transactions
A Call for Balanced Approach
The AFCA chief's comments come as major banks continue to accelerate their branch closure programs across the country. Regional towns that once boasted multiple banking options now find themselves with none, forcing residents to travel hours for basic financial services.
Locke is calling for a more measured transition that considers the needs of all Australians, not just the digitally savvy. "We need to ensure that as we move toward a more digital economy, we don't leave vulnerable people behind," he urged.
The warning serves as a crucial reminder that financial inclusion must remain at the heart of Australia's banking evolution, ensuring that progress doesn't come at the cost of leaving millions stranded from essential services.
