A Cents-Less World

At National Australia Bank’s last AGM, CEO Ross McEwan, responded to concerns about ongoing bank closures.  It’s never easy, he said, in an unconvincing, saddened tone, almost persuading me that this was regretted at the highest levels. However, NAB closed 67 branches in the year leading up to that meeting, so it’s clear that in fact, the bank finds it very easy to do this. They’re sending in the wrecking ball at a rate of more than one branch a week. You could almost say it’s become a hobby.  

NAB has now closed the branch in my hometown. It operated for longer than living memory. Customers will now have to drive a 70 km round trip or a 110 km round trip to walk into a bank and talk to a human being. This is an ageing community and there is no public transport to the nearest branch. NAB has also decided, and gosh, it can’t have been easy, that the town really doesn’t need the ATM.

And yet the bank persists with telling us that they support communities. The fact that this community, like so many others across Australia, helped the National build its value over decades, is irrelevant. Decades of loyalty were discounted with the stroke of a sharpie.

We won’t stop, McEwan said later in the meeting. We will continue to follow our customers to major shopping centres. So, they might keep some branches in malls. That must be comforting news to all the small businesses and shop owners who exist outside of Westfield, Stockland, and Co.

There are at least two stories that the banks tell to justify the killing of personal service. One story is that we don’t want to use cash anymore, and the other is that they are only following us because we all prefer to bank on-line – all the time.  

We are sleepwalking toward paying a terrible price for believing these yarns.   

About 13% of our transactions are now in cash. That’s a big fall over time, but it’s still a significant percentage. Some of us are wary of banking on-line, and for good reason.  Should we trust the banks’ systems and outsourcing policies to maintain the strictest controls over our privacy and information?  When banks know too much about our lives, so do hackers. I could go on and talk about governments and algorithms, but you get the idea. And consider the impact of a cashless world on charities, buskers, tipping, teaching children to manage pocket money and the cash economy. Do we really expect a babysitter to set up an ABN and ask for bank transfers?

My bigger concern is this; if we stop using cash, the banks will soon have a financial stake in every transaction we make.  According to Caitlin Fitzsimmons of the Sydney Morning Herald, Australian consumers are directly paying $511 million a year for the privilege of paying with cards. Are you noticing those surcharges adding up? We will pay extra to use our card, but there won’t be an option to pay with cash? Sounds fair. Not. Australian businesses are now charged $5.8 billion a year for the right to accept credit and debit card charges. 

As to the story that we all want to be on-line, all the time, well, the banks are not following us on-line, they’re herding us. I bank on-line, when connectivity permits, but now and then, I need to go into a branch. That’s usually because the bank tells me I need to come into a branch. When I do go in, there is always a queue. According to the charity, The Smith Family, one in seven Australian families have no internet at home. But Mr McEwan described scenarios where bank staff were standing around for days with nothing to do. I haven’t seen that. Has anyone else? It certainly wasn’t true in my hometown branch. Where exactly is that data about bored employees and empty branches, and who carried out that research?   

I know older people who positively enjoy a trip to the bank. I know that many appreciate dealing with small independent traders. They want to talk to someone they recognise. It’s what helps make a community. When essential businesses are closed in regional and rural centres, it hurts. It increases social isolation, and it causes distress for people trying to sort out problems with a Chat-BOT, or a call centre. Teh closures have disproportionately affected rural communities and NAB was not the only villain here. Yes, I’m aware that I’d get a blank stare if I made any of these comments to the NAB board.  

So, it may be hopelessly quixotic, but I think we need to resist this where we can.  We can all lobby our MPs to do something, anything, to stop the closures. How about a rule that says, if you’re the last major bank in a regional centre, you must keep operating. They were granted banking licenses by the people. It’s time to remind them of the social contract that underpins that arrangement.          

I have increased the number of transactions where I hand over cash. If the business hasn’t warned me that they don’t take cash, I politely insist on them taking it. It is legal tender. If they dig in and say, ‘it’s on our website that we don’t take cash’, I am now more prepared to go elsewhere. (This is not always possible).

I go into branches more often and ask a teller to help me. When they try (sometimes condescendingly) to guide me over to a machine, saying ‘I’ll help you,’ I just say, ‘No thanks. I’m happy for you to do this’.

I wrote to the NAB’s Chair of the Committee for customer service. I wrote to the Company Secretary ahead of the meeting. Of course they didn’t answer, but I’ll persist.  

And I can tune into the NAB shareholder’s meeting because I am a shareholder. I will persist in holding shares, because it gives me the right to vote against executive pay rises. It’s never easy, I say to myself, with drier eyes than Mr McEwan’s.  

FYI – NAB’s profit declared at the AGM, was over $7.7 billion AUD.