Regional and remote parts of Australia are relying on local post offices to do their banking, Australia Post claims, forcing it to fly cash in and out due to high demand in those areas — a practice the company says is “not sustainable”.
Australia Post CEO Paul Graham on Tuesday told a senate estimates hearing that Australia’s banks should help shoulder the load for the growing need for cash in regional areas after banks continue to shut their outlets in those parts of the country, forcing locals to rely on Bank@Post outlets.
“Banks need to be cognisant of their community responsibility and work with us to ensure that communities that do have a need for cash … that those services are made available,” he said, according to a News Corp report.
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Australia Post spokesperson told 7NEWS.com.au that increased demand led to increased costs being shouldered by the postal service.
“Where Bank@Post is the sole provider of basic consumer banking services, there are often increased costs to provide this, especially in rural and remote locations,” an Australia Post spokesperson told 7NEWS.com.au.
“In a number of regional towns, we transport cash in and out at our cost, but this is not sustainable.”
Australia Post said that over the past six months in Roxby Downs, South Australia, which now has no bank branches at all, the cost of providing cash services had tripled from $1043 to $3197 for each cash delivery.
“The provision of cash into these areas meets an important community need, but not one we’re set up to provide,” the spokesperson said.
“Banks need to work with us to ensure communities that have a need for cash services have access to these.”
Financial sustainability
In a statement to senate estimates in October last year, Graham said Australia Post “will never abandon the regions and rural Australia”, but that it did not make sense to “keep the same number of post offices where there is a clear oversupply and where customers are simply not using the service”.
“We know the importance of the services we provide including Bank@Post, parcels and ID services, but they must be sustainable financially, and we recognise the careful balance we must maintain between service, cost, presence and financial sustainability,” Graham said.
“As the current custodian of this business, I am acutely aware that Australia Post plays a critical role in the lives of our customers and the community.“
Australia Post posted a $200 million loss in 2023, the postal company’s second loss since it was corporatised in 1989.
“Without reform and changes to the way we run our business, we will see our losses continue to accumulate,” Graham said.
“This would be a very poor outcome for the Australian taxpayer, and we would require ongoing government support to continue operating.”