After two bumper harvests, small town 'annoyed' to lose bank

Rainbow, population of about 700, in Victoria's southern Mallee has just enjoyed back-to-back bumper grain harvests which had buoyed the local economy.

"We are more than a bit annoyed to find the Commonwealth Bank is closing just when things are looking up," Hindmarsh Shire Mayor and the town's hardware shop owner, Ron Ismay, said.

"Every town needs a bank, it's hard to attract new business without one."

The Commonwealth Bank says the branch will permanently close on Friday, April 23.

The bank's regional general manager David Castle said the branch had suffered a 31 per cent drop in transactions over the past five years.

Mr Castle said the coronavirus pandemic has also accelerated the shift in banking behaviour with a "significant increase" in customers self-serving using online bank apps and "a significant reduction" in foot traffic in branches.

"Customers in older demographics are actively engaging with CBA online," he said.

"For customers over the age of 60, more than twice as many had accessed NetBank or the CommBank App in the past month, compared to the number who had visited a branch in the last three months."

Mr Castle said the bank regularly reviewed its branch locations across Australia "to help us make informed decisions on where to open new branches, where to renovate or upgrade existing branches, and in some instances where to close branches".

He said the bank recognised some older customers still preferred face to banking and in Rainbow customers still had access to other branches at Warracknabeal, Horsham and Hopetoun.

Mayor Ismay said the community was in talks with the Bendigo Bank, or possibly opening a branch, and also with National Bank, which has a branch in town operating on reduced hours.

"We have a brewery about to open with a malting plant, spending on silo art and $1.8 million for a silo tourism venture ... things are happening."

"We are very disappointed with Commonwealth's decision."

Mr Castle also said Rainbow's post office was still available for customers to conduct personal and business banking transactions such as withdrawals, deposits and bill payments including passbooks during normal business hours.