Banking News

Regional banking hub trial ‘less than effective’

The Reserve Bank found a trial of regional banking hubs has “not been successful”, describing them as “less than effective”.

The review of the hubs, released to 1News under the Official Information Act, found a range of issues. They include: lack of privacy and safety concerns, unresponsive phone support and unreliable/out-of action service.

“Communities have been underwhelmed by the limited and at times unreliable services that the hubs offer,” the Reserve Bank said.

“The frustration that hubs are not delivering what locals want is damaging the customer experience and undermining communities confidence and willingness to use them.”

The hubs began in 2020 and are a partnership between the Government and the NZ Bankers Association, on behalf of the six major banks.

They include smart ATMs, a tablet for online banking and a priority phone line. They’re in places like pharmacies or community centres.

NZ Bankers Association chief executive Roger Beaumont says improvements have been made to the hubs.

“Yes there have been some technical hiccups… that’s why in phase two of the hubs we will be developing and enhancing them so it’s a better customer experience,” Beaumont said.

The four initial hubs are in Twizel, Stoke, Martinborough and Opunake. Next year the trial will be extended to include Whangamatā, Ōpōtiki, Tūrangi and Waimate.

Improvements include more privacy and access to specialised banking staff.

“The hubs are about providing a solution for customers, particularly in small towns who just for whatever reason aren’t that comfortable yet with the digital or online environment,” Beaumont said.

In Stoke there was uproar when the last bank closed in 2018. Nelson Grey Power president Sue Sara says members love their banking hub.

“So many of them don’t have the internet where as with the hub. They can go in there, there’s always someone available to help them set up automatic payments, do their baking guide them through the whole thing. It’s absolutely wonderful.”

In the review the Reserve Bank also looked at the wider issue of baking in the regions.

“Even if the hubs are enhanced, our work to date suggests that they will only ever be, at best, a partial solution to an ongoing cutback in cash and banking services in the regions.”

Other options it listed included a code of conduct for when banks close and compelling banks to deliver a certain level of service.

Finance Minister Grant Robertson says all options are worth researching.

“Well obviously there’s things like what’s done in other countries, things like minimum codes for for banks. Arrangements that they have to work through if they do choose to close a branch.”

He says the point of the banking hub trial was to figure out what did and didn’t work.

“I’m sure the outcome of this will be better services in the long term.”

National’s revenue spokesperson Andrew Bayly says it’s crucial that the Government gets this right.

“At the end of the day we need to make sure that people living in rural areas have access to great baking services provided locally.”

He said it’s particularly important for those with disabilities and connectivity issues.

“If the hub concept doesn’t work then we will need to look at other options,” Bayly said.

Most banks have said they won’t close any more regional branches until at least the end of 2023.

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