The end of bank branches

Information verified correct on October 28th, 2016

Are the days of popping into your local bank branch becoming a thing of the past?

The way we bank is changing at a rapid rate. In  the past, if you wanted to open an account, make a deposit or take out a home loan, you had to physically go into your bank branch and meet face-to-face with a teller or a lending specialist.

Fast forward to 2016 and the vast majority of banking transactions, especially for younger generations, are carried out digitally. You can pay the rent, do your shopping, move money between accounts and even apply for a home loan online, all without leaving the comfort of your couch.

Could this shift to digital banking spell the end for bricks-and-mortar bank branches? Let’s take a look at the issues involved and some of the developing technologies that could soon make bank branches obsolete.

Read our guide about online banking here.

ING DIRECT Savings Maximiser

ING Direct Savings Account Offer

Apply for the ING DIRECT Savings Maximiser and receive a high interest rate of 2.75% p.a. when you link with an Orange Everyday account and deposit $1,000+ from an external account each month.

  • Maximum Rate: 2.75% p.a.
  • Standard Variable Rate: 1.60% p.a.
  • Bonus Rate: 1.15% p.a.
  • Monthly Account Fees: $0
  • Minimum Balance: $0
  • Minimum Deposit: $0
Rates last updated October 28th, 2016
Maximum Variable Rate p.a. Standard Variable Rate p.a. Bonus Interest p.a. Fees Min Bal / Min Deposit Interest Earned
ME Online Savings Account
Ongoing 3.05% p.a. variable rate when you link to a ME Everyday Transaction account and make a weekly purchase with your Debit MasterCard using tap & go. Available on balances up to $250,000.
3.05% 1.30% 1.75% $0 $0 / $0 Open More
ING DIRECT Savings Maximiser
Ongoing, variable 2.75% p.a. when you link to an ING Orange Everyday bank account and deposit $1,000+ each month. Available on balances up to $100,000.
2.75% 1.60% 1.15% $0 $0 / $0 Open More
Citibank Online Saver
Introductory rate of 3.05% p.a. for 4 months, reverting to a rate of 1.75% p.a. Available on balances below $500,000.
3.05% 1.75% 1.30% $0 $0 / $0 Open More
Bankwest Hero Saver
Ongoing, variable 2.65% p.a. rate when you deposit at least $200 each month and make no withdrawals. Available on balances up to $5,000,000.
2.65% 0.01% 2.64% $0 $0 / $0 Open More
AMP Saver Account
Introductory rate of 2.55% p.a. for 4 months, reverting to a rate of 2.10% p.a. Available on balances below $5,000,000.
2.55% 2.10% 0.45% $0 $0 / $0 Open More
ANZ Online Saver
Introductory rate of 2.75% p.a. for 3 months, reverting to 1.30% p.a. Available on the entire balance.
2.75% 1.30% 1.45% $0 $0 / $0 Open More
HSBC Serious Saver
Introductory rate of 2.25% p.a. for 4 months, reverting to a rate of 1.60% p.a. Available on balances below $1,000,000.
2.25% 1.60% 0.65% $0 $0 / $0 Open More
Westpac eSaver
Introductory rate of 2.71% p.a. for 5 months, reverting to a rate of 1.25% p.a. Available on the entire balance.
2.71% 1.25% 1.46% $0 $0 / $0 Open More
Rates last updated October 28th, 2016
Monthly Account Fee Debit Card Access ATM Withdrawal Fee Fee Free Deposit p.m. Details
AMP Access Account
An everyday transaction account with fee-free banking.
Visa $0 $0 Unlimited fee-free transactions at rediATMs, $0 transaction fees using BankNet, mobile banking and BankPhone. Open More
ME EveryDay Transaction Account
Free access to any ATM in Australia.
Get your ATM fee refunded within 30 days with $0 monthly fees.
Mastercard $0 $0 No fees when using any ATM in Australia – you'll get a refund within 30 days for any fees you pay for an ATM. More
ING DIRECT Orange Everyday Account
$75 cash bonus.
Get a competitive ongoing variable rate when linked with a Savings Maximiser.
Visa $0 $1,000 No monthly fees, and you can use any ATM in Australia for free when you deposit $1,000 each month e.g your salary. Open More
UBank USaver Ultra
No monthly account keeping fees and earn bonus interest when you deposit $200 or more monthly.
Visa $0 $0 Enjoy no monthly account keeping fees with the USaver Ultra transaction account. More
RAMS Action account
A RAMS everyday transaction account where you can manage your account online.
Visa $0 $0 Free transactions when using the RAMS ATM alliance. Also, get free EFTPOS, online and direct debit transactions. More

A dying breed

Figures released by the Australian Prudential Regulation Authority in 2015 revealed that Westpac, ANZ and NAB all reduced its branch numbers nationwide in the 12 months to June 2015, by 48, 19 and 2 branches respectively. Only CommBank increased its branch network, by one.

Experts are predicting that branch numbers will continue to drop as digital and mobile banking replaces old-fashioned options such as cheques and ATMs for many Australians.

Roy Morgan Research conducted in 2013 revealed that 59% of Australians aged 14 or over (or 11.2 million people) used internet banking at a financial institution in any four-week period and this trend is expected to continue in coming years.

The convenience and time-saving nature of online transactions has played a huge role in the rise of online banking, but there’s also been another important player: the smartphone. Smartphones have made it possible to bank at a time and place that’s convenient to you.

Smartphones have also led to the development of mobile banking apps that are easier and more intuitive to use. In 2015, an international survey by Bain & Company revealed that mobile banking is actually more popular in Australia than internet banking. In 2014, 38% of customer interactions with their bank occurred over a smartphone or tablet (up from 22% the previous year), while online banking made up 35% of customer interactions.

But what does this mean for the banks? In December 2015, the Economist Intelligence Unit surveyed 203 senior retail banking executives from around the world to find out what they thought. A total of 49% of survey respondents agreed with the statement that traditional transaction/branch-based banking model will be dead , while 64% agreed that retail banking will be fully automated and 32% disagreed

The results of this survey suggest that if the banks are to stay relevant in the digital world, they’re going to need to innovate and adapt.

Not the end of banks

While the shift to online and mobile banking services has undoubtedly had an impact on Australian bank branches, this doesn’t mean the end of banks in Australia. The major banks have taken measures to ensure that they are well placed at the forefront of the digital banking revolution. We still have transaction and savings accounts, credit cards and home loans with the same banks — we just don’t need to pop into our nearest branch to manage them.

At the same time, banks are making a raft of changes to the layout of their branches and the services available to customers. With the decline in the use of physical cash, many modern bank branches feature automated teller machines, staff holding iPads, and are far different spaces to what they once were. As more people manage all their day-to-day transactions online, the modern bank branch is being transformed into a place where customers can go for more complex discussions, such as applying for a home loan or receiving financial planning advice.

However, that doesn’t mean the digital revolution doesn’t pose a risk to the major Australian banks. The cost of maintaining branch networks is expensive, and there are plenty of technology-based businesses with their eye on offering cheaper services than the banks in certain sectors.

For example, look at the rise of specialist online money transfer companies in recent years. While sending an international money transfer via your bank can be expensive  thanks to high transfer fees and low exchange rates, online transfer companies don’t have as many overhead expenses as the banks. Focusing their effort on money transfers — instead of the range of products and services banks provide — means these companies can afford to offer cheaper transfers.

Another example can be found in online savings accounts. Without  the cost of maintaining physical branches, many online-only banks are able to offer higher interest rates than competitors that operate in the real world.

A new way of banking

Looking ahead, millions of dollars are being spent around the world trying to predict what the future holds for banking. Some experts have pointed to China’s Alipay as a sign of things to come. The ecommerce payment platform has more than 400 million users around the globe and processed USD $519 billion of digital payments in 2013 alone — as a comparison, PayPal processed just $180 billion.

But while it started out offering an easy way to manage digital payments, Alipay now offers a much wider range of banking services to customers, including transferring funds to other users, paying bills, top up their mobile phone credit and even earn interest on your savings balance. Best of all, it can all be done via your smartphone.

While many of these services are not available via PayPal, you can’t help but feel that it’s only a matter of time before PayPal — and a range of other providers — expand its offerings in the digital banking sphere. And as consumers, we can only be better off for that increased competition.

Shirley Liu

Shirley is's publisher for banking and investments. She is currently studying a Masters in Commerce (Finance) and is the author of hundreds of articles. She is passionate about helping Aussies make an informed decision, save money and find the best deal for their needs.

Was this content helpful to you? No  Yes

Related Posts

Savings Account Offers

Learn about our information service
ME Online Savings Account

Maximum Variable Rate


Standard Variable Rate

ING DIRECT Savings Maximiser

Maximum Variable Rate


Standard Variable Rate

Citibank Online Saver

Maximum Variable Rate


Standard Variable Rate

Bankwest Hero Saver

Maximum Variable Rate


Standard Variable Rate


Ask a Question

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Disclaimer: At we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to the privacy policy, receive follow up emails related to and to create a user account where further replies to your questions will be sent.

Ask a question