Rural Women welcomes Commerce Commission report into banking, looks forward to broader Inquiry

Rural Women New Zealand (RWNZ) is welcoming the Commerce Commission’s final report into competition in the personal banking sector.

“The Commerce Commission’s study confirms there’s a lack of competition in the personal banking sector and makes useful recommendations to unlock competition and improve choice for consumers,” RWNZ Chief Executive Marie Fitzpatrick says.

“We are also pleased to see that the Terms of Reference for the recently launched Parliamentary Inquiry into Banking Competition specifically includes rural accessibility issues.”

“Rural banking customers are being short-changed with regular bank branch and ATM closures making even basic banking tasks difficult. We’re talking about simple things such as cash withdrawals and deposits, access to personal banking services over loans and mortgages and small businesses having to travel long distances to bank their takings and maintain a cash float.”

Figures from the Reserve Bank show that over the past 20 years there has been up to a 45% contraction of bank branches and ATMs across New Zealand, leaving 95 towns unbanked or underbanked.

“While the trend is to push customers to do more of their banking online or on the phone, for many rural communities’ poor digital connectivity remains a big impediment. Some banking customers with poor digital literacy are also frozen out of online banking,” Marie says.

Rural Women New Zealand acknowledges the Reserve Bank’s cash trials for small towns and the commitment from our five big banks not to close any more regional branches for the next three years.

“The continual closure of rural bank branches and ATMs must be brought to a halt through the Parliamentary Inquiry as each loss of service impacts on the ability of rural communities to get business done, as does constrained access to lending and high interest rates.”

“The role of regulation will need to be explored fully through the inquiry, as currently, commercial drivers for the banks are well and truly taking precedence over access and quality of rural banking services.”

Rural Women New Zealand looks forward to making a submission on the Parliamentary Inquiry to ensure our members’ voices and the views of rural communities are heard.

“With the food and fibre sector making up 10.5 per cent of GDP, banks need to support rural communities, farmers and businesses, especially in these tough economic times.”